New Video on the Department of Labor Rule: Right now, Wall Street is using the appropriations process to try to kill a Department of Labor rule supported by President Obama, Senator Booker, Senator Warren, and other leaders in Washington. Watch our new video urging all members of Congress to side with retirement savers, not Wall Street. The full video can be seen here.
Many leaders are fighting back against Wall Street’s latest attempts to include dangerous deregulatory provisions in the appropriations bill and trying to stop a rule that merely puts retirement savers’ best interests above their advisors’ economic interests: Wall Street and its army of lobbyists have again descended on Washington, and they continue to work behind the scenes trying to hijack the appropriations process happening now so they can enact a wish list of dangerous deregulatory provisions. These provisions – which would gut the Financial Stability Oversight Council, undermine the work of the Consumer Financial Protection Bureau, and stop the Department of Labor rule to protect the savings of tens of millions of Americans – would never pass Congress as standalone legislation debated in the light of day.
That’s why Wall Street lobbyists are working around the clock behind closed doors to try and get their allies in Congress to slip these sweetheart deals in this must-pass bill. But this time, Wall Street has met a wall of opposition from President Obama, Minority Leader Pelosi, Minority Leader Reid, and many others who are saying “no” to Wall Street’s special interests. They were joined by other leaders and prominent investor and consumer advocates this week, making it clear that Wall Street won’t get its way without a very big fight.
First, former Secretary of State Hillary Clinton stood up to these powerful forces in a New York Times editorial and statement, making clear that leaders in Washington should reject Wall Street’s latest power grab:
“Republicans, both in Congress and on the campaign trail, are dead-set on rolling back the protections in the Dodd-Frank Act. They’re attempting to defund and hamstring the Consumer Financial Protection Bureau, an agency whose sole purpose is protecting Americans from unfair and deceptive financial practices. They want to roll back commonsense efforts to prevent conflicts of interest by financial managers, which are designed to protect hardworking families’ retirement savings. And they’re trying to undo constraints on risk at some of the largest and most complex financial institutions. President Obama and Congressional Democrats should do everything they can in the budget negotiations to stop these efforts. If Republicans want to hold the American economy hostage for the benefit of special interests on Wall Street, that’s a fight all Democrats should be ready to wage and win.”
Second, Arthur Levitt, former Chairman of the Securities and Exchange Commission, wrote a must-read editorial about the Department of Labor’s rule to protect retirement savers, titled Don’t Let Financial Advisers Off the Hook. Mr. Levitt delivered straight talk on the ways of Washington, writing:
“The Labor Department has put forward a proposal after years of vetting, held four days of public hearings and considered comments from thousands of people. There’s no reason to study the issue further, nor any legitimate argument against the proposal itself. A vote to delay the rule further is a vote to kill the rule — that’s how things work in Washington. Among America’s middle-class families, who are struggling to save enough for college and retirement and life’s other big-ticket items, this delay is going to cost money. Billions of dollars in fees will be paid to unscrupulous advisers who aren’t being held to account. I’ve seen this movie before: In the end, whose money matters more: investors’ or that belonging to the people they’ve trusted for advice?”
Third, Lily Batchelder, Professor of Law and Public Policy at NYU School of Law, and Jared Bernstein, Senior Fellow at the Center on Budget and Policy Priorities, wrote a letter to Senate Minority Leader Harry Reid and House Minority Leader Nancy Pelosi urging them to reject any Wall Street provisions that would prevent this critical rule from moving forward, including an additional comment period, which is really just industry’s attempt to delay and kill this critical safeguard:
“The proposed rule is an essential step forward in shoring up the retirement savings of millions of families. Specifically, it requires financial advisers to commit to put their customers’ best interest before their own profits – a so-called fiduciary standard – if the adviser is receiving compensation that creates a conflict of interest. This common sense approach would go a long way towards reversing the estimated $17 billion that families are losing each year as a result of conflicts of interest. With such large losses for savers and 10,000 Americans turning 65 each day, the need for action is urgent. Nevertheless, some are pushing for the Department of Labor (DOL) to issue a new proposal and open yet another comment period of 15 days before finalizing the rule. We think this would be a grave mistake.”
As this process continues, Better Markets will continue fighting to ensure that members of Congress see these deregulatory provisions for what they really are: special interest giveaways to Wall Street that have no place in a bill that is supposed to be about the American people’s priorities, including homeland security, education, research and development, and more.
Better Markets in the News:
Lobbyists Eye Spending Bill As A Way To Thwart Retirement Regs, Advocates Warn: NPR by Chris Arnold 12/9/2015
Banks, Regulators Face Critical Test in Living Will Results: American Banker by Ian McKendry 12/8/2015
News You Don’t Want to Miss:
Hillary Clinton: How I’d Rein In Wall Street: New York Times by Hillary Clinton 12/7/2015
ECB Shifts Daily FX Rates in Anti-Rigging Move: Reuters by Marc Jones and Patrick Graham 12/7/2015
A Revolving Door Helps Big Banks’ Quiet Campaign to Muscle Out Fannie and Freddie: New York Times by Gretchen Morgenson 12/7/2015
Congress Is About To Gut A Depression-Era Law To Help Wall Street: Huffington Post by Zach Carter 12/4/2015
White-Collar Crime: Obama Administration Memo Urging Prosecutions Doesn’t Scare Firms That Defend Corporate Executives: International Business Times by David Sirota 12/2/2015