Bedding down with Wall Street
A Republican consultant's talking points, and the politicians who recite them
Bedding down with Wall Street
Dick Polman, Inquirer National Political Columnist
Here's the thing about plagiarism: When journalists do it, they lose their jobs. When politicians do it, they're merely doing their jobs.
In Washington, the pollsters and consultants come up with the talking points, and the politicians duly parrot them. Case in point: Senate Republican leader Mitch McConnell's ongoing attempt this week to say No to financial reform of Wall Street, with the help of some clever phrases cooked up by a Republican consultant - for the express purpose of carrying water for the GOP's friends on Wall Street.
Before we review McConnell's performance, let's shine the light on the consultant, Frank Luntz. I can attest that he's a nice guy. He's been road-testing GOP talking points dating back to the '94 congressional elections, and has since branched out to corporate clients. He knows that Wall Street has a bad image, so he advises Republicans to steer clear - at least in their messaging.
In his '07 book, entitled Words That Work, Luntz warns Republicans that Wall Street "is seen as global and cold, with sterile glass structures and office cubicles filled with numbers crunchers concerned more with profits than people." The problem, of course, is that Republicans have traditionally been close to Wall Street, vacuuming up more of its donations than the other party. (According to a massive '08 study by the nonpartisan wallstreetwatch.org, the GOP collected 55 percent of the financial sector's political donations in the 10 years between 1998 and 2008.) But Luntz had a solution: Republicans, in their messaging, should take care to identify themselves with Main Street. In Luntz's words, "Wall Street is about profit. Main Street is about people...Wall Street is about buyouts and takeovers. Main Street is about family."
Which brings us to the current efforts on Capitol Hill - led by Democrats, with a few participating Republicans - to crack down on Wall Street abuses. Earlier this year, when Republican leaders realized that they would have to serve their Wall Street friends by opposing reform, without somehow appearing to side with Wall Street against the little guy, Luntz went to work on the thorny problem. He came up with a solution. He suggested some talking points that made it sound as if the Republicans, by opposing reform, were actually sticking up for the little guy - and that the Democrats, by pushing reform, were sticking up for Wall Street and screwing the little guy.
Luntz suggested that the Republicans talk about how the reforms would (supposedly) empower government bureaucrats to bail out more banks and pin the tab on the taxpayer; as he said in a memo, "The single best way to kill any legislation is to link it to the Big Bank Bailout (of 2008)." He crafted a phrase for GOP use: "If there is one thing we can all agree on, it's that the bad decisions and harmful policies by Washington bureaucrats that in many ways led to the economic crash must never be repeated." And another: "Taxpayers should not be held responsible for the failure of big (banks) any longer."
So here was Mitch McConnell the other day, on the Senate floor, aiming his Luntzspeak at the little guy: "If there's one thing Americans can agree on when it comes to financial reform, it's this - never again should taxpayers be expected to bail out Wall Street for its own mistakes. We cannot allow endless taxpayer bailouts for Wall Street banks."
And yesterday, McConnell was still in mimic mode. The Democratic reforms would mandate "endless bailout of Wall Street banks," and indeed make it "official government policy to bail out the biggest Wall Street banks."
It's bad enough when a politician talks like he's a ventriloquist's dummy. It's even worse - as in this case - when the dummy talk is so egregiously at variance with the facts.
In truth, the Senate reform effort actually gives federal regulators new powers to dissolve large firms that might be threatening the overall health of the financial system. Large firms would be required to submit plans on how they could be liquidated, if such a move became necessary. And contrary to the assertions of Republican leaders, there would be no "fund for permanent bailouts," supposedly serviced forever by the taxpayers; the truth is virtually the opposite. The feds working to dissolve the bad firms would need to keep the lights on during the liquidation process, and they'd have $50 billion to make that happen - but that money wouldn't be extracted from the taxpayers. The banks would be required to cough up that money.
No wonder Wall Street dislikes this reform effort. No wonder McConnell huddled with a number of Wall Street firms last week, to plot strategy. No wonder he was such a great vehicle for Luntzspeak, given the fact that since 1998 he has reportedly received $4,250,800 from financial industry interests.
The problem, for Republican leaders, is that the Luntzspeak is so transparent; it can't mask the fact that the party in bed with Wall Street is merely pretending to stick up for Main Street. The Senate Democrats don't need a consultant to articulate that fundamental truth.
Mike, You're right, you are a strange conservative— PA_Dutch- I hope the liberals understand that most of the volunteers spilling their blood in Afghanistan and Iraq are mostly conservatives. And Mike I- what a stupid post. Care to back that up with some facts instead of regurgitating a Rahm Emanuel index card talking point??? I shall listen to the crickets.
- Pa_Dutch Coming from you. I will take it as a badge of honor.— Mike Welbourn
- Obama on America, in a speech, "whether we like it or not, America remains a military superpower...". "Whether we like it or not...." That is our president. Reminds me of what he said in a 1990 AP interview that was mentioned on Meet The Press, about transforming America from a mean spirited country into one that is more generous. The man who would be a future president calling America "mean spirited". That is our leader. No wonder our enemies cower at the mere mention of his name.— tom - wilmington, de
- The House and Senate today passed extended unemployment benefits and COBRA subsidies. Included in the bill was the Medicare "Doc fix". You remember the Doc fix, right? That was the 25% cut in Medicare reimbursements included in the deficit reducing healthcare reform measure passed a couple of weeks ago. So already they are going back on the cuts that were included in the healthcare bill. It now adds to the deficit. Oh well.— tom - wilmington, de
- Do you get the sense that some days the author just puts something up here to stir up the troops - that there's just nothing here?— JimR
- "Wall Street is about buyouts and takeovers. Main Street is about family." OK, let's bring some family values to Wall Street. If your sixteen-year-old totals the family car, you don't give them the keys to the new one until you give them some new rules to try and prevent the situation from happening again. We The People are the parents (assuming we still believe in Government Of The People &c.), the Wall Streeters are the road-running teenager, and the car is the American economy. McConnell? The word for him is "enabler." BTW, why was Fox Business reporting yesterday that guests at a Goldman Sachs fundraiser for Harry Reid had some harsh words for the good senator? Sounds like the bankers don't like being told that they need some reasonable boundaries.— Billy Ray Winthorpe
- "Is that what we want, a government with the ability to seize a private firm based on some subjective criteria? What happens to the stockholders? What happens to the creditors? What happens to those with mortgages with the taken over firm?" Tom, you don't have to be a shareholder or a creditor to be a stakeholder when it comes to these particular firms. When someone who makes 9 bucks an hour at the convenience store can lose even that job because some number of someones in Lower Manhattan took risks they should have known better than to take - well then, the $9 man is a stakeholder. We're all stakeholders. We all collectively had to put $700 billion of skin in the game just to keep the game going. When that's the way things are then I would say that the only thing worse than a government with the power to take over strategic financial-sector firms whose collapse threatens our entire economy, is a government WITHOUT that power.— Billy Ray Winthorpe
- JimR- Maybe you are right. Today's column was a half ditch effort.
- "Today's column was a half ditch effort." Are you sure you don't mean it was a last-assed effort? :)— Billy Ray Winthorpe
- I still have hope for bipartisanhsip, mainly because the Repubs should be starting to figure out if they keep doing what they've been doing, they going to be overwhelmed. Obama and the Dems are too smart for the likes of McConnell, Boehner, McCain and Palin. Party of Fools.— Djoko Pritza
- Billy Ray, so I take it you are in favor of the government having the ability to take over any firm based on some subjective criteria. Will you be just as in favor when a Republican is in the White House? Do you like the idea of the president ordering the takeover of a company such as Chavez has done in Venezuela with the television, radio and many other industries? Perhaps Obama should be able to say "lower the principal on the mortgage of anyone currently unemployed for more than 6 months or else I will take you over as being dangerous to the economy", sort of how Chavez told companies any that raised prices would be nationalized. Is that what you believe America should be about? Djoko, Republicans overwhelmed? What are you smoking?— tom - wilmington, de
- Djoko- You might not be so good at looking at polling data. I hope the 30% that are die hard Obama koolaid drinkers are just as bamboozled as you are. You do so at your own political peril. The Obama presidency is an insult to the intelligence of the average American. Mocking and disparaging the tea party protesters is no way to build a winning coalition. Conservatives, Independents, and Libertarians are voting against the partisan democrats. It has played itself out in VA, NJ and Mass. Here's to you continuing to live in denial. Party of fools? The majority of Americans would seem to me to be uniting against government largesse. It is not about political partys, it is about the American people and the American voter. When you realize that ; then, and only then , will you see the light of day. You are far too imersed in bitter partisanship to see any truth.
- Tom, just saying "Chavez!" over and over like he's some kind of boogeyman doesn't make for a persuasive argument (though saying it in a mirror five times might possibly cause him to appear out of nowhere with a big damn' hook in his hand). It seems pretty clear to me that when any one sector of the economy can cause the whole shebang to collapse then government has to be a countervailing force to prevent that from happening. And banking is that sector. If the Big Three automakers shut up shop, people in Detroit would eventually figure out something else to do (and a lot of them would probably find that something else in another location). If the banks shut up shop, though, credit stops moving. Construction, consumer spending, business investment - it all goes in the toilet. We know this because it's happened before in the early '30s. So while you're worried about an administration that acts like Chavez, I'm worried about one that acts (or more to the point, that DOESN'T act) like Herbert Hoover's. If it makes you feel better, though, perhaps we might suggest that pending legislation should include some objective standards?— Billy Ray Winthorpe
Tom in Wilmington lays bare the capitalist tax on society, which is double in nature. This is due to the simple fact that, especially with a monopoly form of big business today, pricing is a giant collusion between so called competitors. Big business always raises their prices to maintain profit targets to ensure an adequate return on investment that allows shareholder value, stock prices, to go up. While government as a sovereign state has the power to tax and ensures the property rights of its citizens to go out and start businesses, it can not limit the wealth confiscation of business to simply pass on their responsibilities to pay tax onto their customers with never ending price increases, cost push inflation. Once a business gets a taste of a windfall profit, they try to maintain this level so as not to be punished by Wall Street, for retreating in profitability, even if it is generated not by the business model but by external events, such as the oil industry with the Iraqi war and futures trading speculative practices, such as Enron, especially with their "weather trading desk". Who knew you could monetize weather reports into a self regulating market? Therefore, Tom's claim that business take their taxes, add them as a cost, pass them onto the consumer, is not an argument that the government is doing its explicit job in collecting taxes, but twists and distorts this into a ponzi swindler like Bernie Madoff, secretly taxing us, the average guy, disguised as poplulism when it taxes big banks. It is the banks, that not only want to make money off of us, then, charges us fees and 32% interest on credit cards to offset their tax bill, they also want us to be a labor ready pool of talent and work for them during the good times, and just fall off the payroll when they need more profits, especially on their merger path to too big to fail and ultimately, repudiate any obligations, even to fund their pensions for their loyal workers in retirement.
Cited by the Columbia Journalism Review as one of the nation's top political reporters, and lauded by the ABC News political website as "one of the finest political journalists of his generation," Dick Polman is a national political columnist at the Philadelphia Inquirer. He is on the full-time faculty at the University of Pennsylvania, as "writer in residence." Dick has been a frequent guest on C-Span, MSNBC, CNN, NPR and the BBC. He covered the 1992, 1996, 2000, and 2004 presidential campaigns.
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