We should be glad the cost of politicians isn’t included in the consumer price index. If it were, inflation would soar. The passage of the omnibus spending bill guaranteed hyperinflation for the cost of political influence. It also guaranteed the end of Abraham Lincoln’s “government of the people, by the people, and for the people.”
Instead, we have a government of the lobbies, by the lobbies and for the lobbies. It is a government funded by the entities with the largest checkbooks. It is time, as some have suggested, that members of Congress wear suits like NASCAR drivers so we can see who their sponsors are.
As discussed in the media, the omnibus spending bill contained more than spending resolutions. Among other intrusions it contained a bill that let us know who owns Congress. Another may raise the cost of owning Senators and Representatives about tenfold.
You can understand by playing a few rounds of Follow the Money with me.
The rider receiving the most attention was H.R. 992. This bill removes the Dodd-Frank restrictions on bank trading of derivatives. These are the strange little instruments that are so profitable for banks some of the time and so devastating at other times. The distinction is that when they are profitable, it’s private profit. But when they are devastating, it brings a public rescue by the Federal Reserve.
The bankers get the mine. We get the shaft. You and I can’t get deals like this, but the Too Big To Fail banks can. When you are Too Big To Fail, you’re also big enough to write the rules.
In fact, the bill wasn’t written by a politician or by his office support staff. It came straight from Citigroup. The original wording was 100 percent Citigroup. As the nation’s third-largest bank it is definitely in the Too Big to Fail category.
Writing the bill wasn’t all. According to opensecrets.org, Citigroup’s political action committee contributed $804,000 to Congressional campaigns in 2014. That's about $5,000 per candidate supported. More to the point, 34 of the 57 Democrats who voted for the bill had received money from this PAC at some time since 2010. Yes, Citigroup spent money on Republicans too, but getting them in favor was less of a struggle.
Willie Sutton robbed banks because “that’s where the money is.” Congress is clever: they get their cash as a gift.
You should also know that Citigroup isn’t just any corporation. If we had a “three strikes” rule for corporations, Citigroup would already be in prison for life. Citigroup is a repeat offender in the same way as individuals who are habitual offenders. Citigroup just keeps showing up before the judge.
Here are recent fines and settlements Citigroup has paid or made, as recorded on the Corporate Research Project website:
- The Financial Industry Regulatory Authority (FINRA) fines Citigroup $5 million related to analysts offering favorable research coverage in connection with a planned public offering.
- FINRA fines Citigroup $15 million for failing to adequately supervise communications between stock analysts and clients.
- The U.S. Commodity Future Trading Commission fines Citigroup $310 million and the British Financial Conduct Authority fines it $358 million to settle charges it (and other large banks) had manipulated the foreign exchange market.
The Justice Department announces Citigroup would pay $7 billion to settle charges due to the banks packaging and sales of toxic mortgage-backed securities that led to the 2008 financial crisis.
Institutional investors suing Citigroup for its sales of bad residential mortgages win an agreement that the bank will pay $1.13 billion to settle their claims.
That’s just 2014. Actions against this miscreant corporation go back not years, but decades.
As if this isn’t offensive enough, another rider in the Omnibus bill rubs salt in our wound. The bill describes it as “Division N—Other Matters” on page 1599 of the undebated 1603 page bill. The rider increases the sums of money individuals and PACs can contribute to political campaigns. But that's an understatement. Put the changes together and political contributions can be 10 times larger. That's hyperinflation.
Mark Twain once said, “There is no native criminal class except Congress.” Years ago, I thought that was funny. Now I consider it straight reporting.