Financial Industry Spends Big As Obama Pushes for Regulatory Reform

For Immediate Release

Contact: 

Mary Boyle, (202) 736-5770

Financial Industry Spends Big As Obama Pushes for Regulatory Reform

WASHINGTON - On the one-year anniversary of the collapse of Lehman Brothers,
President Obama's proposed overhaul of financial regulations faces
fierce opposition from the securities and investment industry, which is
spending furiously on lobbying Congress and on campaign contributions.

For the first six months of 2009, the financial industry spent $42
million lobbying Congress, as Obama pushes for reforms that would
better monitor the financial system and the products that banks and
other institutions sell to consumers with the goal of avoiding future
economic meltdowns like the one that plunged the United States deep
into recession.
The most vocal opposition to financial regulation reform is the U.S.
Chamber of Commerce, which has focused specifically on a proposed
Consumer Financial Products Agency (CFPA) meant to oversee financial
products such as subprime mortgages.

Like health care or climate change, reform of the financial system in
the wake of the economic meltdown is defined largely by a single
proposal that is fiercely opposed by industry. National polls have
demonstrated widespread support for better regulation of financial
products after the explosion of risky subprime mortgages bankrupt
Lehman Brothers and nearly brought down the entire banking system. As
President Obama delivers his address today, the industry is spending an
average of more than $250,000 a day in lobbying and advertising to kill
the proposed Consumer Financial Products Agency and other reforms.

"Practically every proposal in the President's reform agenda - from
health care to climate change to financial regulation - is under attack
from industries that are pouring money into campaign contributions,
lobbying and advertising campaigns," said Common Cause President Bob
Edgar. "Great speeches are no match for the bottomless pockets of big
corporations looking to kill reform legislation."

In addition to lobbying and advertising, the securities and investment
industry has given more than $14 million in campaign contributions this
year, on top of the $156 million it gave during the last election
cycle, according to data from the Center for Responsive Politics.
Because the Democrats control Congress, nine of the top ten recipients
of securities money so far this year are Democrats:

 

Candidate

Amount

Schumer, Charles E (D-NY)

$678,700

Gillibrand, Kirsten (D-NY)

$347,600

Reid, Harry (D-NV)

$336,450

Dodd, Chris (D-CT)

$209,112

Murphy, Scott (D-NY)

$155,050

Bennet, Michael F (D-CO)

$143,655

Himes, Jim (D-CT)

$139,386

Dorgan, Byron L (D-ND)

$118,250

Wyden, Ron (D-OR)

$105,400

Cantor, Eric (R-VA)

$98,100

Source: Center for Responsive Politics (www.opensecrets.org)

 

Any industry may soon also be able to spend similar amounts on
advertising campaigns in support of specific candidates who support
their position, as the U.S. Supreme Court is considering striking down
restrictions on direct political advocacy by corporations. The Supreme
Court will likely issue a ruling this year in Citizens United v. Federal Elections Commission on whether industries are allowed to spend unlimited amounts on candidates like they do on specific issues.

"We are going in the wrong direction lifting limits on corporate
spending," said Edgar. "President Obama came into power with a mandate
for reform, but it seems corporate industries can fight back almost any
public desire for change by spending enough money on lobbying and
campaign contributions."

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Common Cause is a nonpartisan, nonprofit advocacy organization founded in 1970 by John Gardner as a vehicle for citizens to make their voices heard in the political process and to hold their elected leaders accountable to the public interest.

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