Banks take backseat on debt ceiling debate
After their thunderous and highly vocal lobbying blitz to block or delay swipe fee restrictions, why have American banks lost their voice during the debt ceiling debate?
Short answer: a lack of guts.
Bank henchmen were vociferous in their objection to most aspects of financial reform, venting in congressional hearings and tossing media statements about like confetti.
So how to explain the sudden silence from the Brooks Brothers set -- save for a last-minute (and limply worded by comparison) letter from bank CEOs warning of "grave" consequences should Congress and the president fail to act?
A blog in American Banker summed up the silent treatment this way: "When elephants dance, the mice get trampled."
The upshot is, last month's lobbyist lions now feel powerless as church mice for fear that any stand they take today might come back to bite them in the butt tomorrow.
Whew! And here I thought they were merely a bunch of self-serving parasites!
Perhaps you'll enjoy this anonymous snippet as much as I did:
"'I wish this was the days where we could run up to the Hill and we could scream and people would listen to us, but sometimes people don't care what we think,' said one lobbyist for a large bank, who spoke on condition of anonymity. 'The people that need to be convinced that raising the debt ceiling is important don't like big, Wall Street banks.'"
Really? And who does? (present company excluded, of course.)
Even the AB reporter expressed incredulity that one of the most powerful lobbying machines in Washington could shrink from lion to mouse inside of two weeks.
"The lack of activity stands in stark contrast to banks' lobbying campaign to delay a rule that would limit interchange fees on debit card transactions. While the issue was important to financial institutions, the swipe fee rule's impact is dwarfed by the potential repercussions if the U.S. defaults."
Have I mentioned that President Obama has repeatedly requested the pleasure of banking's company at the debt ceiling table?
On Thursday, three CEOs -- JPMorgan's Jamie Dimon, Goldman Sachs' Lloyd Blankfein and Bank of America's Brian Moynihan -- finally stepped forward, not with a plan mind you, but with a collective whine that inaction "would be a tremendous blow" to the country.
Hey, I think we've figured that out already, but thanks for caring.
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