Hillary, the friend of Wall Street

Dear Friends,

Bernie Sanders went to Wall Street on Tuesday to give a speech making his policies very clear.  He will break up the big banks, he will prosecute individuals not just fine the companies, he will reinstate Glass-Steagall, and he will raise taxes on Wall Street.  You can read the text of his speech here.  Hillary Clinton tries to sound tough on Wall Street, but she isn't and really can't be because she takes so much money from them for her campaign, for the Clinton Foundation and for speaking engagements for Bill and her.

ThinkProgress had a great piece on the differences between Senator Sanders and Secretary Clinton with respect to Wall Street (here).  The piece points out three differences.

First, Senator Sanders would reinstate Glass-Stegall and breakup the big banks that are already too big to fail.  Hillary Clinton refuses to work to reinstate Glass-Steagall or commit to breaking up the banks.  In fact she argues that Glass-Steagall would not have prevented the Great Recession.  The ThinkProgress piece summarized the arguments as follows:

Clinton has questioned the value of Glass-Steagall and said the law repealed while her husband was in the White House could not have helped prevent the 2008 housing collapse. Sanders disagrees, saying the so-called “shadow banks” whose failure triggered the recession, such as AIG and Lehman Brothers, got their money from federally-insured bank deposits of big commercial banks, which would be illegal under such a rule. Regardless of whether the law could have prevented the Great Recession, Sanders argues it could curtail risky behavior in the future.

Second, Secretary Clinton says that she will increase the taxes on Wall Street's risky trading but her proposed taxes are small compared to Senator Sanders' proposal.  Here from the ThinkProgress piece:

“Hillary’s is kind of a half-plan, which doesn’t raise as much revenue,” Mike Konczal with the Roosevelt Institute told ThinkProgress. “The more people have looked at it, the weaker it seems. It’s not sufficient to tackle the problem, because it exempts a huge amount of trades.”

Third, the piece acknowledges that the changes proposed by Senator Sanders would require significant participation by Congress.  It also indicates that the people that are appointed to important financial positions in the government can make a huge difference.  As I indicated in an early blog post, Senator Clinton's chief financial advisor is a Wall Street insider (here).  Here is how the ThinkProgress article ends:

Though Clinton has similarly not revealed who she would appoint to lead the Federal Reserve and other agencies, Konczal says the two candidates would likely show stark differences in their nominations.

“Hillary would appoint people who think Dodd-Frank is mostly successful and just needs a little more work,” he said. “Bernie would appoint people who think our financial system is a massive problem and needs a major overhaul.”

Clearly Secretary Clinton leans in the right direction.  Unfortunately, she does not understand or is not willing to push for the "major overhaul" that is needed both with respect to financial matters and in many other respects.  Senator Sanders will fight for the massive changes that we need.

Thanks for reading and please comment,
The Unabashed Liberal