Time to Rally for Financial Reform

To paraphrase Marat-Sade: 'the
Election came, and the election went, and unrest turned back into
discontent.'

The Dems lost two Governors,
one an unpopular former head honcho at Goldman Sachs (not exactly a
populist crusader), and picked up one house seat in a Congressional District
no one ever heard about before.

They hope that all the recovery-is-coming
news will stem the tide of growing disenchantment with the centrists
in Obamaland who have been swimming hard to stay in place.

As the sense of crisis seems
to be abating thanks to lazy media reporting, Rahm Emamuels suggestion
that a crisis is a terrible thing to waste seems itself a distant memory.

We may or may not get a health
care reform but how many of us now believe it will transform much or
even significantly lower costs as long as the industry is allowed to
dilute proposals for both public option and single payer.

While Nancy "the Hare"
Pelosi is pushing for a vote right away, Harry "the tortoise" Read
says we will have to wait until next year.

So much for a sense of urgency,
but at least there is some motion on that ocean.

Not so for the urgently needed
financial reforms that are being blocked by our friendly financial tycoons,
even as our kissing cousins across the pond move to break up their big
banks.

Inaction is scary enough but
even more alarm bells are being rung by Eliot Spitzer, once the
"Sheriff of Wall Street" until his pecker got in the way of his
assaults on the pecking order.

George Washington of Washington's
Blog reports:

"Yesterday,
Elliot Spitzer said that the White House's
defense of the financial status quo will give Republicans powerful ammunition
in the 2010 elections."

Democratic cheerleader
Markos Moulitsas (the "Kos" behind Daily Kos) wrote the following about
the Democratic losses in several state elections:

"Democratic
turnout collapsed. This is a base problem, and this is what Democrats
better take from tonight:

... If you water
down reform in favor of Blue Dogs and their corporate benefactors, you
will lose votes...

If you forget
why you were elected - ... financial services ... reform - you will
lose votes..,'

People are sick
and tired of both parties' catering to the big boys. Indeed, given
last night's election results and the Dems' utter failure to institute
any real financial reform, trend forecaster Gerald Calente's prediction that a third party
candidate will win the 2012 presidential election is sounding a little
less crazy."

Writing on New
Deal 2.0 Spitzer explains why he believes the right will jump on this
issue perhaps even outflanking the Obamacrats:

"Few things are as potent in
politics as calling for change at a moment of fundamental dissatisfaction
with the status quo. Nobody should know this better than the current
White House. Gauzy words describing the possibilities for change are
always more comforting than defending the current dire straits. That
is why - in addition to all the substantive arguments - the current
White House plan for banking reform is so troubling."

Let us fast
forward a couple of months. Momentary GDP pops notwithstanding, the
economy next year is likely to be in pretty sad shape. Consumer spending
is sagging; foreclosures are still climbing (and may surge as ARMs re-set);
unemployment is likely to be hovering in the 9.5-10.0 range; federal
deficits and state deficits will be soaring; and Goldman profits will
still be setting new records.

Added to this
toxic political brew will be a new, and perhaps counter-intuitive, but
highly successful political attack from the Right: break up the banks.
Imagine this: by next spring, an intellectual consensus will have emerged
that the concentration in the banking sector that developed from the
1980s until the crash of '08 was misguided. Voices as disparate as
Former Fed Chair Paul Volcker, Bank of England Governor Mervyn King,
meta-investor George Soros, and the Wall Street Journal editorial page
will be in agreement on this point."

Blogger Zach Carter says it is
essential for progressives to get out in front and take a stand now,
writing: "If we want the economy
to support all people, we have to break up the big banks and start treating
the creation of good jobs as an economic priority on par with Wall Street
rescues.

The editors of The Nation break the
political debate over banking into three camps:

"The first camp is composed of bank lobbyists,
Republicans and conservative Democrats and wants to do nothing.

Camp two, endorsed by the White House and influential
Rep. Barney Frank (D-MA), would impose tougher regulations on too-big-to-fail
banks to keep them from getting out of control.

The third camp wants to go even further: If
a bank is too-big-to-fail, it is also too-big-to-regulate. Companies
that pose a danger to the economy have to be split up into smaller firms
that cannot induce economic ruin."

This third camp is growing with conservatives
realizing that unless they radically reform the system, it will remain
volatile and unstable. Isn't it time for those of us who still cling
to the hope that real change is needed to start focusing on this issue
and realize that the power of big money is standing in the way of what
we want and need.

Can't we become at least try to become champions of those confronting
higher fees imposed by banksters and endless foreclosures leaving millions
without homes or hope. Extraction demands reaction. Plunder demands
protests and pitchforks!

Can't we remember that catchy phrase
so many of us once echoed in the glow of an earlier time just a year
ago?

Yes We Can!