The Warren Wing -'Sanders' Plan To Reform The Fed Exposes A Democratic Rift On Wall Street' - HuffPo

[WillyT]

Sanders' Plan To Reform The Fed Exposes A Democratic Rift On Wall Street
The Clinton wing of the party is still figuring out what to do with the Warren wing.
Daniel Marans - HuffPo
12/30/2015 03:24 pm ET


Democratic presidential candidate Sen. Bernie Sanders (I-Vt.) put forward a lengthy list of Fed policy reforms on Dec. 23, 2015.
Joshua Lott/Getty Images

<snip>

The Federal Reserve is becoming the focal point of a longstanding divide between more business-friendly Democrats and the party’s populist branch over how the next president should promote full employment and police Wall Street.

Democratic presidential hopeful Sen. Bernie Sanders (I-Vt.) put forward a lengthy list of proposals for reforming the Federal Reserve in a Dec. 23 op-ed in the New York Times.

Lawrence Summers, a former top economic adviser to President Barack Obama, who nearly became Fed chairman in 2013, penned a response on Tuesday agreeing with Sanders on some grounds, but forcefully pushing back against the notion that Wall Street influence at the Fed is too pervasive.

The disagreement between Sanders and Summers embodies a larger rift within liberal ranks about the need to lessen the influence of Wall Street at all levels of government. But it also reflects broad agreement on the centrality of the Fed as an enabler of economic growth and the need for greater financial reforms.

The Fed has a dual mandate to maximize employment and maintain stable prices, which it does primarily by adjusting a benchmark interest rate. Sanders argues that the proverbial revolving door between Wall Street and the Federal Reserve has led the central bank to neglect the public in both of these duties.

Like many other progressive lawmakers, advocates and economists, Sanders believes that the Fed should not have raised the key interest rate -- as it did earlier this month -- until unemployment was lower and wage growth was higher. Prices, these critics note, have been rising at a rate well below 2 percent, the inflation target the Fed currently uses as a sign it must raise rates to prevent the economy from overheating dangerously.

“Raising rates must be done only as a last resort -- not to fight phantom inflation,” Sanders wrote in his op-ed. Sanders also contends the Fed should have done more to impose conditions on its emergency lending to the big banks during the financial crisis and that it should be doing more to regulate them now.

To address both of these problems, Sanders calls for a series of reforms of Fed governance aimed at rooting out conflicts of interest that make the Fed more beholden to financial elites and less sensitive to the needs of ordinary people.

“If I were elected president, the foxes would no longer guard the henhouse,” Sanders wrote.

<snip>

More: http://www.huffingtonpost.com/entry/bernie-sanders-the-fed-wall-street_5684180ae4b0b958f65affd5?qicz0k9

[daleanime]

1. K&R....

[HerbChestnut]

2. Just finished reading that article.

It's worth the time.

[WillyT]

3. Thanks...

[Hortensis]

29. This isn't really much of a rift. Both candidates are

pulling the same direction. The differences are the methods and trade-offs and how much can be accomplished.

A PRESIDENT CAN ACCOMPLISH NOTHING ALONE. Success depends on gathering sufficient support from others to start up and feed the machine of change. Hillary has it. Bernie does not.

Hillary can effect real change. Bernie is insisting that it's not enough -- and that's good IF causes the crowds of people, whose support Hillary will need to make change happen, to raise their goals even a little bit higher.

Let's get real -- there are huge, fabulously wealthy crowds already marshaled to make sure change does not happen. Electing a Democratic president is only the next stage in a long battle back out of the hole.

[jhart3333]

36. The difference is Bernie really means it.

And only Bernie has a chance at bringing in a receptive congress on his coat tails.

[MADem]

52. Receptive Congress? How many Congressmen has Bernie helped?

How many has he campaigned for? Raised money for?

He's not known for helping out his fellow legislators.

You know how "receptive" the Congress is to him? Take a look at his super delegate count, that will give you a general idea. Compare it with Clinton's...who has the more 'receptive Congress?'

[Hortensis]

54. 2016 is when we come together to win.

After all, divided the People fell. It's up to us to fix it. In 2016.

[MADem]

56. Everyone hates Congress, but they LOVE their own Congressional delegation.

There are a few races that are contestable, but there's not going to be a wholesale "Throw Them Out" attitude.

[Hortensis]

57. I believe that's untrue in many districts. There is a tremendous

difference between grimly supporting corrupt representatives out of extreme, mistaken partisanship and "loving" them. The widespread anger we're seeing this year is because people realize they're being betrayed by those they put their trust in but don't feel they have a viable alternative.

[MADem]

58. Every election year, people say this. Every year, they return the same assholes to the legislature.

Kelly Ayotte in NH is in trouble--and that's a good thing. There are a few others who need to watch their backs, but don't expect a massive shift.

"Not MINE" is the watchword. Pork is a powerful aphrodisiac.

[Hortensis]

60. As I said.

[jhart3333]

61. Pork? Try gerrymandered districts from hell.

They won't see it coming just as you don't see it coming for Hillary. We know the bullshit that's been going on and we are going to put a stop to it.

[onecaliberal]

4. But but but, she's going to fight wall street.

Just as soon as all the polling comes in.

[WillyT]

6. Now CUT THAT OUT !!!

[onecaliberal]

9. Okay...

[WillyT]

13. She Actually Said That...

[onecaliberal]

16. Indeed...

[jfern]

28. They'd be fighting themselves

The Clinton Foundation is less than a block from Wall Street. For good reason.

[onecaliberal]

33. Couldn't agree more.

[lewebley3]

35. Like all Sanders bill is congress his plan will fail: He would have to

have votes.

[concreteblue]

5. Yawn...yet another "hope nobody actually reads the article" post....

The desperation to attach ANYTHING negative to the Good Senator is palpable.

[WillyT]

7. That Was Deep, Man...

[concreteblue]

18. I may have responded to the wrong article

I was not logged in. After logging in you don't get sent to the article you were on, you get sent back to the front page. Still, upon reading this one, it seems like a bunch obvious observation if the reader has been paying any attention at all this season.

[libodem]

8. K&R

[CharlotteVale]

10. Lawrence Summers, the one who said women aren't as smart as men.

What a prize Democrat for Hillary to have on her side.

[Uncle Joe]

11. Kicked and recommended.

Thanks for the thread, WillyT.

[DhhD]

12. If we have running away inflation, why did the Social Security Benefit check stay the same

for 2016 as it was in 2015 and CEO pay rose by 3.9%?

http://www.motherjones.com/politics/2015/11/elizabeth-warren-wants-give-seniors-raise
snip
But in recent years, with the economy still puttering only slowly upward following the recession, inflation has stalled, which has left Social Security recipients with no or minimal annual increases. 2016 is set to be only the third year since 1975 when Social Security won't get any cost-of-living increase, joining 2010 and 2011.
more at link



http://thehill.com/policy/finance/259264-warren-sanders-team-up-on-bill-to-hike-social-security-checks
snip
The senators want to pay for the supplemental payment by killing a tax code provision that allows companies to deduct a portion of executive salary, so long as it is “performance based.”

Under current tax law, companies can only deduct the first $1 million in executive compensation, but performance-based pay, like stock options, is exempted from that restriction. Noting that CEO pay is still on the rise while Social Security benefits are flat, Warren said it’s clear top executives could chip in.
more at link


It is great to see Warren and Sanders working together to help out the Social Security Insurance Trust Fund and its recipients. And they are bringing to light more inequality that hurts the American people and our economy.

[Eric J in MN]

21. The Fed members would say they're preventing inflation before it happens. NT

NT

[shadowmayor]

14. Wall Street

This isn't a pro or anti candidate request. Just go see The Big Short. Take as many folks as you can. Be prepared to be pissed and wonderfully entertained at the same time. Steve Carell and his crew are fantastic as is Christian Bale. Bottom line, the folks on Wall Street just flat don't give a shit period. And go see The Big Short!!!

[Enthusiast]

15. Kicked and recommended! We must lessen the influence of Wall Street at all levels of government.

Yay, Bernie!

[floriduck]

49. Iceland was smart enough to take over the banks

and prosecute the bank officers. But here in the richest and most "exceptional" country on the planet, we prefer to let the banks pay our elected officials to fuck us over. And that is not a partisan participation. Here in Washington, Patty Murray, the tennis shoe mom, and war monger Maria Cantwell rolled over for TPP to help Boeing open a parts factory in China. Murray is up for re-election and she's lost my vote.

[Enthusiast]

62. It's incredible but true. I would never vote for a TPP supporter.

[Live and Learn]

17. K&R nt

[Amimnoch]

19. "“If I were elected president, the foxes would no longer guard the henhouse,” Sanders wrote. " -odd

“If I were elected president, the foxes would no longer guard the henhouse,” Sanders wrote.

I wonder.. is he really that ignorant? Or is he just spouting another his fantasy lies?

I'd think that as a member of Congress he'd know that the office of the President of the US has no oversight at all of the Federal reserve. It's authority comes from Congress. It's board of governors answers to the president in no way shape or form. The only one that can initiate an audit of the Fed is the GAO.. which also reports to CONGRESS, not the President.

Sanders has more power over the Fed as a Senator than he EVER would as a President. Does he not know that? Or is he lying?

with this in mind, how many bills has Sanders sponsored or co-sponsored for an audit of the Fed? As a Senator has he pushed for the GAO to audit the Fed? Or is this just political bullshit? hmmmmm...

I haven't seen a statement as ignorant (or deceptive) from a candidate since Ron Paul.

[salib]

20. Wow

I normally do not provide feed.

However, two points here:
1.) the President does have the power of appointment where the FEd is concerned. Thus, Bernie could simply be referring to that and then would not at all be a "liar" as you are encouraging the reader to consider.

Secondly, please read about how Bernie was instrumental in arranging an audit of the Fed:
http://www.huffingtonpost.com/news/sanders-fed-audit/
And then, let's look at your comment:
"Sanders has more power over the Fed as a Senator than he EVER would as a President. Does he not know that? Or is he lying?

With this in mind, how many bills has Sanders sponsored or co-sponsored for an audit of the Fed? As a Senator has he pushed for the GAO to audit the Fed? Or is this just political bullshit? hmmmmm... "

So, did you know about (the very well covered news about the first audit of the Fed enabled by Bernie). Or are you lying?

[Amimnoch]

30. I stand corrected. Sanders did make the attempt at the audit.. he just failed at that like almost

everything else.

But, he'll be much more effective as President.. given that there's no version of the 115th congress that will make his ideology reality.

[mhatrw]

44. Yeah! Why even try? Isn't it much easier just to do the foxes' bidding?

if you know what I mean

[Amimnoch]

47. Perhaps we should resort to prayer as well?

I believe in science, math, and facts.

Fact: There is NO version of the 115th congress that will even come close to making the bill votes that would be REQUIRED to make the false promises St. Bernard is making come true.

My Grandmother has been dead for 16 years. Is there a point in me digging her up and trying to resuscitate her? As you put it "why even try?".

[mhatrw]

50. There is no hope for one without hope.

Why even have the words "hope" and "change" and "fairness" and "justice" in our language? Why even try to describe the kind of country you want since you can never get it?

[LiberalLovinLug]

64. You have described Hillary supporters exactly

Its sad to watch. They have given up. They have resigned themselves to the status quo corrupt oligarchy going forward. For them, they have accepted that the bad guys have won, so its better to have THEIR bought off corporatist in charge, rather than the other teams bought off corporatist in charge.

[ish of the hammer]

55. it's called a "strawman argument" and

it stinks!

[quoddy woman]

66. What a a horrid metaphor!

...but very telling.

[WillyT]

22. So... You Just Dropped In From Pluto To Give Us This Profound Opinion ???

Hard to take you seriously if you have not done your homework.

Or worse...

[Plucketeer]

37. Isn't it amazing?

With the pool of irrefutable intellect awash here on DU, you'd think there'd be WAY MORE candidates with PERFECT resolutions for each and every problem that might confront the POTUS. I sure hope that somehow we DO stumble into campaign reform one day. That will have to result in a great number of the "brains" of DU vying for office. Any of whom would deal ONLY in absolutes and never have to rely on hope or chance to achieve their aims. In fact, they might well do the Alaskan Governor maneuver and quit before their term is up - having done every good thing they could so for the general populace!

[dreamnightwind]

25. One of the more uninformed posts in recent memory

Sanders actually GOT an audit of the Fed.

Not even correct use of "it's", you used the contraction form (short for "it is&quot in contexts requiring the possessive form ("its&quot .

"Spouting another his fantasy lies?"

If we could hide a post for inaccuracy, I would alert. Better, though, to leave it for all to see, it tells a lot about what you know and what agenda you push regardless of the facts.

[Amimnoch]

31. OOOoooo, busted. You're right, my grammar and use of it's was incorrect.

Gold star for you.

As for everything in the message.. that still stands.

I've conceded from another's reply that Sanders has attempted to audit the fed (LOL with Ron Paul no less). He just failed at getting it done. Worse, after pushing for it, he stabbed Paul in the back and failed with the follow through. That was a very enlightening link.

[questionseverything]

39. bernies compromise was successful 96-0

One of the frequent targets of ire from both the left and right is the Federal Reserve, which critics charge is failing to be “accountable to the President and Congress.” Shortly after noon today, the Senate passed, by a 96-0 vote, Sen. Bernie Sanders’ (I-VT) amendment requiring a one-time audit of the Federal Reserve since Sept. 2008. The audit covers the time when the Federal Reserve became active in using its resources to help prop up rapidly failing financial institutions and megabanks. Sanders had altered his amendment since its original introduction to limit it to an audit of the Fed’s books only since the recent financial crisis. The amendment originally called for a full audit of the institution’s records, and Rep. Ron Paul (R-TX), who successfully passed such a measure in the House of Representatives and advocates for ending the Federal Reserve, referred to Sanders’ amendment as “watered down.”
UPDATE
Sen. David Vitter’s (R-LA) amendment, which echoes the language in the Paul amendment in the House, failed along a 37-62 vote.

http://thinkprogress.org/politics/2010/05/11/96327/sanders-audit-fed/

[dreamnightwind]

41. You were proven wrong then you doubled down rather than apologizing

using Ron Paul spin against Sanders? Isn't that special.

Yes, Sanders "caved" to the Obama administration to limit the scope of the audit to the financial crisis period.

The audit was performed, the first GAO audit in the hostory of the Fed.

http://www.sott.net/article/250592-Audit-of-the-Federal-Reserve-Reveals-16-Trillion-in-Secret-Bailouts

The list of institutions that received the most money from the Federal Reserve can be found on page 131 of the GAO Audit and are as follows..

Citigroup: $2.5 trillion ($2,500,000,000,000)
Morgan Stanley: $2.04 trillion ($2,040,000,000,000)
Merrill Lynch: $1.949 trillion ($1,949,000,000,000)
Bank of America: $1.344 trillion ($1,344,000,000,000)
Barclays PLC (United Kingdom): $868 billion ($868,000,000,000)
Bear Sterns: $853 billion ($853,000,000,000)
Goldman Sachs: $814 billion ($814,000,000,000)
Royal Bank of Scotland (UK): $541 billion ($541,000,000,000)
JP Morgan Chase: $391 billion ($391,000,000,000)
Deutsche Bank (Germany): $354 billion ($354,000,000,000)
UBS (Switzerland): $287 billion ($287,000,000,000)
Credit Suisse (Switzerland): $262 billion ($262,000,000,000)
Lehman Brothers: $183 billion ($183,000,000,000)
Bank of Scotland (United Kingdom): $181 billion ($181,000,000,000)
BNP Paribas (France): $175 billion ($175,000,000,000)
and many many more including banks in Belgium of all places

[dreamnightwind]

40. deleted - responded to my own post by mistake

[underthematrix]

27. Thank you. i think it is unfortunate DEM voters

buy into this sort of nonsense because they don't understand the history and role of the federal reserve. These are the sort of things GOPers and Fox Hate News pundits are constantly feeding their viewers. It's sad.

[Perogie]

51. Grow up

[Amimnoch]

53. Oohhhh da "bern"

Cute.

[Proserpina]

23. Thanks for the thread, Willy T

[WillyT]

24. Anytime Proserpina... Anytime...

[Betty Karlson]

26. I am part of the Warren wing, that is for sure.

And I will NEVER trust Clinton again. Vote maybe, but never trust.

[ananda]

63. Ditto

I will vote for Clinton, but I would much prefer Sanders!

[WillyT]

32. Morning Kick !!!

[99Forever]

34. [phone]

[Duval]

38. K&R! Thanks, WillyT!

[NCTraveler]

42. I'm a proud member of the Warren Wing.

She even taught me the secret handshake right after she asked the candidate I'm supporting to run for President.

Can't wait for Warrens speech at the convention. Yes, she will give a great one.

[mhatrw]

45. Too bad your candidate is not. nt

[NCTraveler]

48. Always that possibility. Nt

[Major Hogwash]

46. Thanks, Willy. Great article.

[WillyT]

65. Thank You !!!

[Ivan Kaputski]

59. Does Wall Street control who will be the next POTUS?

[kristopher]

67. See this 2008 talk by Stiglitz

http://www.democraticunderground.com/1017318170