When House leadership was handing out committee assignments to the freshmen class of 2008, in the midst of one of the biggest financial crises to ever rock the country, it was decided that the best thing to do was put new members who needed campaign cash for tough 2010 battles on the Financial Services Committee.
And so 11 freshmen members from conservative leaning districts were assigned to the committee, basically setting them up to be “bribed” by Wall Street.
Ryan Grim and Arthur Delaney deserve huge kudos for this piece, which outstrips any coverage I’ve seen in the financial press this year and gets to the heart of darkness as to why the banks continue unregulated.
Here’s a microcosmic view of the problem:
Over the summer, a senior Democrat on the committee, Maxine Waters of California, complained about committee members’ closeness to bank lobbyists after freshman Blue Dog Suzanne Kosmas (Fla.) skipped a hearing on the financial crisis to attend a fundraiser with lobbyists from the financial industry.
“I understand they have almost hired a lobbyist for each one of us,” Waters said, speaking after Speier in an almost completely empty hearing room. “I never expected that given the subprime meltdown and the number of foreclosures that we have that we would get that kind of opposition. How soon we forget. And I’m more concerned that there are members of Congress who are beginning to take on the arguments of the financial services industry about why a consumer financial agency is not necessary.”
Then Waters chastised Kosmas for skipping out: “Even yesterday when we were engaged with consumer advocates, one member got up and left and went to a fundraiser with the banking community, in the middle of all that. Well, all I have to say is, I’m hopeful that our advocates will be stronger than ever and we will fight against this opposition.”
It takes seven Democrats to side with the GOP members of the Committee to pass anything, and the 11 freshmen in need of campaign cash are good targets (they have raised an average of $1.09 million for their 2010 races). However, that cuts both ways: when Alan Grayson was trying to whip votes to audit the fed, those from conservative districts who have well-funded GOP opponents like freshman Walt Minnick (Vaughn Ward) and sophomore Ed Perlmutter (Ryan Frazier) were afraid to vote “nay” and pay the price next November.
Kosmas has raised $155,486 from finance, insurance and real estate interests. She skipped the vote:
According to a HuffPost analysis of the 243 people who’ve worked on the committee — including clerical and technology staff — since 2000, almost half of the 126 people who have left registered as lobbyists, mostly for the financial services industry.
There’s no reason that members should be taking contributions from industries they regulate as members of a committee. Nor should they be on one that pays an immediate family member. Evan Bayh’s wife went around soliciting participation on boards of businesses regulated by the Senate Banking Committee when her husband was appointed. Family members are one of the principal ways that cash finds its way into the pockets of members of Congress (Tom DeLay, Tom Daschle, Chris Dodd, etc. etc.)
If a member of Congress feels the need to take donations from a particular industry, or if their family member feels a strong need to do so, the member should resign from the committee and find a different one. There are plenty of ways to serve that don’t involve such conflicts of interest.