(Too Much and Press Associates) — Why do regulators in Washington so often do their best not to irritate overpaid bank and corporate execs? In many cases, they’re counting on these same execs to hire them into cushy corporate jobs that pay astronomically more than they’re making in government service.
Recognizing that revolving door between Wall Street and Washington, progressive lawmakers last month filed legislation to slow if not stop it. The AFL-CIO, AFSCME, Public Citizen, Americans for Financial Reform, and other progressive groups back the bill.
The new Financial Services Conflict of Interest Act, by Sen. Tammy Baldwin, D-Wis., Rep. Elijah Cummings, D-Md., and others, doubles the time former government employees have to wait before they can lobby for a company they used to regulate.
It also bans government employees from accepting bonuses from their former private sector employers for entering government service.
And current government workers, including financial institution supervisors and procurement officers, would be banned for two years from working for the institutions they regulated or whose contracts they approved.
“Hard-working middle class families can’t afford to have the financial industry and government creating a cozy relationship that allows Wall Street to write its own rules,” said Baldwin. “We need to ensure government officials are working on behalf of the public interest and our common good. The American people can’t afford to have government officials in the pocket of the financial industry that they are charged with overseeing.
“At a time of historic income inequality, we need to do everything we can to make sure we are building an economy that works for everyone. We can’t afford to have a revolving door working to stack the deck in favor of Wall Street and against hard working Americans who are struggling to get ahead. The American people deserve to have trust in the fact that government is working for them and that the system is not being rigged against them,” she added.
“Working families deserve to know they can count on financial regulators to protect them,” said Heather Corzo, director of the AFL-CIO’s Office of Investment. “For far too long the revolving door between Wall Street and federal financial regulators has allowed big corporations and Wall Street banks to have way too much influence on financial policies.
“How can the public trust that executives who received seven- or eight-figure golden parachutes from their former employers can properly regulate them?” Corzo asked.
“Those who accept the honor of public service must serve only the interests of the American people,” added Rep. Elijah Cummings, D-Md., the lead House sponsor. “There is absolutely no reason someone entering government service would need a payment from any outside source as a reward for that service or to incentivize favorable treatment-including from a previous employer-and no company would offer these payments if they didn’t yield some benefits to them.”
Sens. Brian Schatz, D-Hawaii and Elizabeth Warren, D-Mass., are also original co-sponsors of the bill. The measure, however, is expected to make little progress in the Republican-run 114th Congress. The GOP chairs of its banking and financial services committees are more intent on tearing down laws and regulations enacted five years ago. Lawmakers passed those bills in response to the financiers’ finagling that led to the Great Recession and its disastrous impact on workers.
You can Urge Congress to pass the “Financial Services Conflict of Interests Act” by signing the AFR petition.
Photo: Flickr Code Pink Creative Commons
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