Financial Lobbyists: Five for Every Member of Congress

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Financial Lobbyists: Five for Every Member of Congress

WASHINGTON - Some
850 banks, hedge funds, business groups, and other interests hired
3,000-plus lobbyists and spent at least $1.3 billion to influence
financial regulatory reform legislation pending before the Senate,
according to the Center for Public Integrity story, “Five Lobbyists for Each Member of Congress on Financial Reforms.”

An
examination of lobbying disclosure data for all of 2009 and the first
quarter of 2010 showed there were five lobbyists for each member of
Congress attempting to influence bills aimed at tightening regulation
of banks and capital markets. Public outrage over Wall Street's role in
the 2007-09 financial meltdown blunted industry attempts to win
loopholes in the measure newly passed by the U.S. Senate.

Most
of the big players in American business lobbying were active as reform
proposals worked their way through the House and Senate. The U.S.
Chamber of Commerce deployed 85 lobbyists, including 49 hired from
outside lobbying firms. Among financial services groups, the Securities
Industry and Financial Market Association dispatched 54 lobbyists,
including 37 from outside firms, according to Center data.

Banks
and the financial industry spared little expense in lobbying. Citigroup
Inc. deployed 38 lobbyists, Moody’s Corp. 13, and Bank of America 11,
all dedicated to the financial reform legislation.

The
companies and groups that lobbied on financial reform spent a total of
$1.3 billion during the five quarters on their overall lobbying
efforts, the data showed. The exact dollar amount they devoted to
financial regulation reform remains unclear because lobbyists are not
required to itemize how much money in a given contract is spent on a
specific issue. But if only 10 percent of that spending was targeted at
financial regulation bills, lobbyists would have received $133 million.

In
this debate, however, public perception of big U.S. banks as
free-wheeling gamblers relying on taxpayer-funded safety nets
overwhelmed Wall Street’s lobbying, some experts said. Public opinion
against Wall Street was galvanized over excessive bailouts, lavish top
executive bonus payments, and the Securities and Exchange Commission's
fraud lawsuit against Goldman Sachs Group.

“Political
backlash overwhelmed lobbying,” said Arthur Wilmarth Jr., a banking law
expert at George Washington University. “Earlier this year, there was a
sense that we’ve gotten past the worst of it, so let’s not overreact.
Now the fact that all of these (European) governments have taken on all
this debt, I think people now realize the crisis isn’t over yet and
don’t really want the financial industry going back to taking risks.”

Even
with Tea Party protests against Wall Street excesses and Democrats’
push to toughen government oversight for big banks, the financial
industry managed to score some victories.

A free and independent press is essential to the health of a functioning democracy

Peter
Garuccio, a spokesman for the American Bankers Association, said the
industry’s accomplishments, at least up to now, include preserving
Federal Reserve oversight of state member banks and eliminating a
proposal for a $50 billion fund to help pay for dismantling large banks
considered too big to fail. “Some of the concerns we’ve raised have
been addressed, others have not, and others have been partially
addressed,” Garuccio said. “It’s still an ongoing process.”

Reform
advocates have their own victories to point to in the legislation’s
current form. They include the creation of a federal consumer financial
protection bureau, fee limits on debit card transactions, and a
one-time audit of the Federal Reserve’s role in the financial bailout.

To
view a list of banks and other companies that received government
bailouts and how many lobbyists they hired to work on financial
legislation, an interactive graphic can be embedded for the Web, or click on the following link:

 

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The Center for Public Integrity is a nonprofit organization dedicated to producing original, responsible investigative journalism on issues of public concern. The Center is non-partisan and non-advocacy. We are committed to transparent and comprehensive reporting both in the United States and around the world.

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