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Wall Street's Majority Leader

May 20, 2010 - by Donny Shaw

If you think the Senate has a pro-Wall Street tilt right now, just wait until the current Majority Leader is defeated and the next in line takes over. The Washington Post is running a piece today on the many reasons why the Senate’s current number-three Democrat, Sen. Chuck Schumer [D, NY], is the most likely candidate for the position after/if current Majority Leader Harry Reid [D, NV] is defeated in the November mid-terms, not the progressive number-two, Sen. Dick Durbin [D, IL].

Obviously, this big leadership change would affect a lot more than just the Senate’s deliberations over the financial industry. Schumer would probably be an all-around more aggressive leader than Reid, and would maybe be more progressive in some areas. But on Wall Street, Schumer’s tendency to go easy is remarkable.

Besides John McCain [R, AZ] and John Kerry [D, MA] who were recently in presidential contests, Schumer has taken more money from the finance industry than any other sitting senator — a whopping $16.7 million according to data from the Center for Responsible Politics.

During the current financial reform debate in the Senate, Schumer bucked the Democratic leadership to place a few big votes against Democratic amendments that were aggressively opposed by the Wall Street banks. He voted “abstain” on an amendment from Sen. Byron Dorgan [D, ND] to ban so-called “naked” credit default swaps (the amendment failed by a mere three votes). He also voted “no” on a Sen. Sherrod Brown [D, OH] amendment to place leverage limits on banks and force a handful of the biggest banks to make themselves a bit smaller. By contrast, Reid voted in favor of both of these amendments.

In December 2008, just a few months after the September financial crisis, the New York Times published a piece on how Schumer “has embraced the industry’s free-market, deregulatory agenda more than almost any other Democrat in Congress, even backing some measures now blamed for contributing to the financial crisis.” The article has him riffing on some of the financial industry’s favorite talking points — example: "Wall Street and Main Street are tied together” — and recounts his history of crossing the aisle to work with Republicans on deregulatory legislation.

In one sense, Schumer has just been doing his job of representing his NY constituents, and he has been rewarded for it. But put together Dick Durbin [D, IL] saying earlier this year that the banks “own” the Congress, the fact that the big banks have only gotten bigger and contributed more money to Congress since they were deemed “too big to fail,” and the Supreme Court’s recent decision to let the banks and other corporations contribute as much of their profits a they want to political activities, and putting a senator who literally represents Wall Street in the #1 spot is startling.

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