The Ties That Bind

A cover story in today's issue of The New York Times offers a rare glimpse into the deep (and deepening) ties between the Democratic Party and the financial sector. Although some writers like Robert Kuttner of The American Prospect have been warning about this relationship for years, it is rare to see it covered in mainstream publications like the Times.

What I think is unusual about the article is that it is the rare one that actually talks about the degree to which government operates on a "cash and carry" basis and how that approach leads to policies that serve narrow interests at the expense of the commonweal.

The story also contains a number of telling quotations like the following:

An unnamed executive summarizing remarks made by Sen. Chuck Schumer at a Wall St. event:

We are not going to be a bunch of crazy, anti-business liberals. We are going to be effective, moderate advocates for sound economic policies, good responsible stewards you can trust.

Lee A. Pickard, a lawyer representing financial sector clients including the Bank of New York:

If you get Chuck Schumer on your side, you are O.K.

Barbara Roper, director of investor protection for the Consumer Federation of America:

Since the financial meltdown, people have been asking, ‘Where was Congress? Why didn’t they see this coming? Why didn’t they provide better oversight?’ And the answer for some, including Senator Schumer, is that they were actually too busy pursuing a deregulatory agenda. Their focus was on how we have to lighten up regulation on Wall Street.

John Bogle, the founder and former chariman of The Vanguard Group:

He [Chuck Schumer] is serving the parochial interest of a very small group of financial people, bankers, investment bankers, fund managers, private equity firms, rather than serving the general public. It has hurt the American investor first and the average American taxpayer.

And Sen. Shumer himself talking about the need for regulation going forward:

You need to provide safety and security to investors in order to attract them to the markets, On the other hand, you must be sure that regulation does not snuff out the entrepreneurial vigor and financial innovation that drives economic growth and makes financial institutions successful and profitable.