http://www.thenation.com
On December 13th, the House Financial
Services Committee convened what is likely to be the last hearing of
this Congressional session for the purposes of seeking “alternatives” to
the Volcker Rule. The Volcker Rule, as I’ve written previously for The
Nation, is a piece of Wall Street reform with a crucial purpose: to
create a firewall that bars banks that enjoy FDIC insurance from risky,
speculative gambling. On Wall Street, gambling with the firm’s money is
known as proprietary or “prop” trading. This is an important rule to get
right, and its final version has been delayed far too long. And
unfortunately, the aim of this hearing was not implementing the
regulation, or even about exploring alternatives to the Rule, but rather
dragging things out to the benefit of the banks.The hearing put on
display everything we’ve come to expect from our most beholden members
of Congress. Many questions had clearly been penned by bank lobbyists,
and a largely hostile reception greeted the two witnesses, William
Hambrecht and Dennis Kelleher, who dared to defend the reforms. But
three Representatives in particular— Chairman Spencer Bachus (R-AL),
Rep. Shelley Moore Capito (R-W.Va.), and Rep. Jeb Hensarling (R-TX), the
incoming Chairman of the Committee—stood out, handing over their pulpit
to a litany of misrepresentations about the effect of the rule.
ECOLEFT