Just in case you missed it while Christmas shopping over the weekend, the U.S. Senate finished off a $1.1 trillion spending bill that prevents a government shutdown.
It does lots of worthy things and one thing that drives Sen. Elizabeth Warren crazy.
It also allows banks to go back to trading derivatives with consumers’ deposits rather than requiring them to form subsidiaries to do that only with part of the banks’ money, money that would be uninsured by the Federal Deposit Insurance Corp.
Ms. Warren says that undoes some of the Dodd-Frank regulations meant to avoid another Wall Street meltdown of the kind that ruined the economy in 2008. As in, the meltdown that required a taxpayer bailout of Wall Street.
She points out the repeal was slipped in without any hearings in the Senate, although it went through hearings in the House and many experts think other regulations will prevent more trouble.
The Wall Street Journal, for example, as Sen. Pat Toomey mentioned, points out that only 5 percent of a bank’s derivatives trading could be moved into the uninsured subsidiaries, and 95 percent remain FDIC insured. Thanks to the bill, now 100 percent will be insured. Hence, Ms. Warren’s bailout argument.
Financial matters like derivatives are endlessly complicated so it’s hard to tell if she’s right at the moment. For example, to this day, the Wall Street Journal thinks Washington, not Wall Street, was to blame for the meltdown.
Nonetheless, here at The Borys Blog, I strive to hold people accountable when bad things happen.
The House, with our local congressmen 2-1 in favor, approved the spending bill Thursday by a 219-206 vote. The Senate, with both the Pennsylvania senators in favor, voted 56-40 in favor on Saturday.
So if you’re looking for someone to blame later on if Wall Street collapses again and this regulatory change is responsible, you’ll know that:
— Sen. Bob Casey voted for the bill because it increases spending on child nutrition programs, provides $35 million for dredging the Delaware River, ups funding for the National Institutes of Health and Head Start and provides money for lots of other stuff that he likes and that he thinks people will benefit from. He says he “strongly disagrees” with parts of the bill, though his statement didn’t say where his disagreement lies.
— Mr. Toomey says he voted yes because the bill cuts federal spending by about $12 billion, prevents the incandescent light bulb ban, forbids taxes on Internet access, increases spending on Alzheimer’s research, “spares farmers from burdensome EPA regulations on land use”, “exempts about 400,000 people from Obamacare and ends the law’s taxpayer bailouts of health insurance companies for 2015.”
It also does lots of other stuff he likes and that he thinks people will benefit from.
— U.S. Rep. Tom Marino, R-10, Lycoming Twp., voted yes because he got assurances from House Republican leaders that his amendment to defund President Barack Obama’s immigration “amnesty” plans will get voted on in the new, more-Republican House next year, and because funding for the Internal Revenue Service was cut (ending the administration’s targeting of conservative groups and individuals), because of cuts in funding for the federal Environmental Protection Agency (EPA) and blocks on federal regulation of farm ponds and irrigation ditches.
He didn’t say if there’s other stuff he likes and that he thinks people will benefit from.
— U.S. Rep. Lou Barletta, R-11, Hazleton, says he voted yes mainly because it’s senseless to fight the fight against Mr. Obama’s “executive amnesty” on immigration while Democratic U.S. Sen. Harry Reid is still in charge of the Senate.
“After careful consideration, I have determined that it is a much better strategy to have the fight over funding the amnesty program once our reinforcements have arrived in the form of the new Senate to be sworn in early next year,” he said in a statement.
Speaker John Boehner also assured him that he will “play an integral role in crafting new, strong national immigration policies beginning in January,” he said.
He also didn’t say if there’s other stuff he likes and that he thinks people will benefit from.
— U.S. Rep. Matt Cartwright, D-17, Moosic, voted no, the only one among the people who represent Northeast Pennsylvania in Congress to do that. Unlike the others, he didn’t issue a news release explaining why, which means we haven’t heard from him about whether there’s stuff in the bill he likes and that people will benefit from.
— BORYS KRAWCZENIUK
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If Wall Street melts down again, maybe local reps in Congress will share the blame
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