Barney Frank

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The Democratic House Women of the 113th Congress

The New York Times Caucus blog has posted this picture.

Female members of the House Democratic caucus posed for a photograph on Thursday on the steps of the Capitol.

This is most of the 61 women of the Democratic House caucus.

Favoring hues of deep reds and blues, they gathered in the chilly January air, waving to old friends and greeting the new. They laughed and joked, cheekily inviting Representative Barney Frank, a departing Democrat from Massachusetts, to hop in the picture. (He politely demurred.) At one point, a young male aide to Nancy Pelosi, the House minority leader, scurried up to grab some of the members’ coats, juggling the fur and wool throw-overs in his left hand while trying to snap iPhone photos with his right.

As latecomers wandered up, the women called for the photographer to wait, pointing out the stragglers.

There will be 20 women in the Senate and 81 in the House – a record.  Debbie Wasserman Schultz is among the missing from the photograph, however.

But Representative Debbie Wasserman Schultz of Florida emerged from the House moments too late, just as the group was dispersing. However, all was not lost; the photographer took some shots of the late arrivals, and the caucus plans to Photoshop them in.

What did we do before Photoshop?  And don’t the women who did make it look wonderful?

Photograph by Mark Wilson/Getty Images

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The Frank-Dodd Financial Reform Bill

Helene Cooper writes in the New York Times this afternoon

 President Obama signed into law on Wednesday a sweeping expansion of federal financial regulation, marking another — and perhaps last — major legislative victory before the midterm elections in November, which could recast the Congressional landscape.

The signature achievement — a response to the 2008 financial crisis that fundamentally alters the relationship between Wall Street and the federal officials charged with regulating it — is a culmination of two years of fierce lobbying and intense debate over how to deal with the financial excesses that tipped the nation into the worst recession since the Great Depression.

The law subjects more financial companies to federal oversight, regulates many derivatives contracts and creates a panel to detect risks as well as a consumer protection regulator. A number of the details have been left for regulators to work out, inevitably setting off complicated tangles down the road that could last for years.

Obama Financial Reform

Mr. Obama took pains to try to show how the complex legislation, with is dense pages on derivatives practices, will protect ordinary Americans.

“If you’ve ever applied for a credit card, a student loan, or a mortgage, you know the feeling of signing your name to pages of barely understandable fine print,” Mr. Obama said. “But what often happens as a result, is that many Americans are caught by hidden fees and penalties, or saddled with loans they can’t afford.”

He said the law would crack down on abusive practices in the mortgage industry, simplifying contracts and ending hidden fees and penalties, “so folks know what they’re signing.”

So what exactly is in the bill?  According to a summary in the Christian Science Monitor

A bill summary by Capitol Hill staff members includes 100 points. Here’s a shorter take, 10 points, focusing on less-publicized elements as well as some core provisions:

• A first-ever federal office focused on the insurance industry will monitor the insurance industry for systemic risk. The industry will remain regulated largely at the state level.

• FDIC deposit insurance for account-holders at banks, thrift institutions, and credit unions will be raised to $250,000 (from $100,000) retroactive to Jan. 1, 2008.

• The State Department would have to submit an “illicit minerals trade strategy” for the Congo region. Manufacturers that use minerals originating in the Democratic Republic of Congo would have to disclose measures taken to exercise due diligence on the source and chain of custody of the materials. The provision, sponsored by Sen. Sam Brownback (R) of Kansas, could affect high-tech firms like Intel and Apple.

• The bill beefs up the powers of the Securities and Exchange Commission, including extra funds for enforcement. The SEC would get new power to impose fiduriary responsibility on investment brokers. That means the brokers would have to offer advice based on the best interest of clients, not broker fees. Consumer advocates say the bill should have mandated this change, not allowed the SEC to consider it.

• New disclosure rules would apply to credit-rating firms, along with new penalties if the firms are irresponsible. In a nod to an amendment backed by Sen. Al Franken (D) of Minnesota, the bill seeks to end “shopping for ratings” by calling for the SEC to propose ways to prevent issuers of asset-backed securities from picking the firm they think will give the highest rating.

• Shareholders would get a “say on pay,” with the right to a nonbinding vote on executive pay and golden parachutes. Standards for listing on an exchange would require that compensation committees include only independent directors.

• Reforms would reshape Federal Reserve powers, including a ban on Fed bailouts targeted at specific firms (like AIG) in the future. The presidents of regional Fed banks would be selected entirely by directors representing the public, and not partly by directors representing banks that the Fed regulates.

• The bill creates a new Consumer Financial Protection Bureau to consoldiate duties now charged to various federal agencies. It would have a consumer hot line, for questions on things like mortgages, and a new office of financial literacy.

• A Financial Stability Oversight Council of top economic regulators will monitor systemwide risks. The bill summary says this group will ask the Federal Reserve to adopt “increasingly strict rules for capital, leverage, liquidity, risk management and other requirements as companies grow in size and complexity.”

• An “orderly liquidation” mechanism would allow the Federal Deposit Insurance Corp. (FDIC) to dismantle large financial companies that are on the brink of failure. Shareholders and unsecured creditors would bear losses, to end taxpayer bailouts. But the bill also allows the FDIC to shelter solvent banks from having to bear losses if there is a threat to overall US financial stability

Thank you to Barney Frank, Chris Dodd, Olympia Snowe, Susan Collins and Scott Brown and all the Democrats except Ben Nelson we have a start and reining in the runway, unregulated financial system.

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Friday Night Random Thoughts

Why have I picked the wrong upsets in the first round?  I picked  Cornell over Missouri and VCU over UCLA for example and totally didn’t see Dayton beating West VA. 

Why is everyone so focused on the President’s Special Olympics “gaffe”?  I thought his dancing around the Tim Geithner question was much worse.  Besides all those special olympians are now going to get to bowl at the White House. 

Why hasn’t Norm Coleman surrendered yet?  I have read that it is expected that Al Franken will likely pick up some votes as the court studies some more ballots.  Then Coleman says he will appeal.  Franken is asking Coleman to pay his legal costs.  I think Minnesota needs an second Senator and let’s just certify the election and let Al take his seat.

Why is is always so cold on the first day of spring in Boston?  At least this year it isn’t snowing.

I wonder what criticism the Republicans will come up with about the White House vegetable garden?  Marion Burros had a lovely story in the New York Times yesterday.  Seems everyone will have to pull weeds, including the President.  I guess that will be more time he is wasting when he should be focused on the economy.

Will President Obama and Barney Frank acually suceed in rewriting the regulations concerning financial institutions?  Does anyone else remember when stock brokers were separate from banks and the twain was never supposed to meet?  Maybe we need to go back to those days?

The cats are gathering and telling me it is time to stop having random thoughts and focus on their dinner.

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The Military Budget

President Obama said he expected to save money by withdrawing troops from Iraq (which savings will actually show up in the budget now that Iraq and Afganistan spending is no longer “off-line”) and that saving is part of how he proposes to spend on things we all want like health care, education, and energy efficiency.  That is all well and good.  But the elephant in the room (and I don’t just mean Republicans, but also Democrats with their own self-interests) is military spending.

Congressman Barney Frank has an article in the March 2 issue of the Nation in which he talks about military spending.  He begins

I am a great believer in freedom of expression and am proud of those times when I have been one of a few members of Congress to oppose censorship. I still hold close to an absolutist position, but I have been tempted recently to make an exception, not by banning speech but by requiring it. I would be very happy if there was some way to make it a misdemeanor for people to talk about reducing the budget deficit without including a recommendation that we substantially cut military spending.

As Congressman Frank points out there has been a huge increase in the military budget and not all of it attributable to the Wars in Iraq and Afganistan.

It is particularly inexplicable that so many self-styled moderates ignore the extraordinary increase in military spending. After all, George W. Bush himself has acknowledged its importance. As the December 20 Wall Street Journal notes, “The president remains adamant his budget troubles were the result of a ramp-up in defense spending.” Bush then ends this rare burst of intellectual honesty by blaming all this “ramp-up” on the need to fight the war in Iraq.

Current plans call for us not only to spend hundreds of billions more in Iraq but to continue to spend even more over the next few years producing new weapons that might have been useful against the Soviet Union. Many of these weapons are technological marvels, but they have a central flaw: no conceivable enemy. It ought to be a requirement in spending all this money for a weapon that there be some need for it. In some cases we are developing weapons–in part because of nothing more than momentum–that lack not only a current military need but even a plausible use in any foreseeable future.

It is possible to debate how strong America should be militarily in relation to the rest of the world. But that is not a debate that needs to be entered into to reduce the military budget by a large amount. If, beginning one year from now, we were to cut military spending by 25 percent from its projected levels, we would still be immeasurably stronger than any combination of nations with whom we might be engaged.

So are there any signs of hope that we might, despite what will be a conservative outcry about “keeping America strong” and the loss of jobs from miliary spending (can’t many of those folks shift toward developing good things like better batteries for electric/hybrid cars?) and so on?  Christopher Hayes  in a companion piece to Frank’s writes

Indeed, over the past year Defense Secretary Robert Gates has made a series of speeches about shifting resources toward nonmilitary international engagement, as well as reducing spending on outdated weapons systems. “The spigot of defense spending that opened on 9/11 is closing,” he told senators on the Armed Services Committee in January. “The economic crisis and resulting budget pressures,” he said, would provide “one of those rare chances…to critically and ruthlessly separate appetites from real requirements, those things that are desirable in a perfect world from those things that are truly needed in light of the threats America faces and the missions we are likely to undertake in the years ahead.”

Obama expressed similar sentiments on the campaign trail: “I will cut tens of billions of dollars in wasteful spending,” he said in a campaign video. “I will cut investments in unproven missile defense systems. I will not weaponize space. I will slow our development of future combat systems.”

Most recently, Rahm Emanuel hinted on Meet the Press that the administration might have the Pentagon in its sights as part of its promise to trim fat from the budget. “We have about $300 billion in cost overruns,” he said. “That must be addressed, and we will be addressing it.”

We seem to be getting some mixed signals, however.  William Lynn from defense contractor Raytheon who has been described by Hayes (and others) as “never having met a weapons system he didn’t like”  has been appointed deputy defense secretary.  On the other hand,  Obama has just appointed Ashton Carter from the Kennedy School to be Under Secretary of Defense for Acquisition, Technology and Logistics.  As far as I know, Dr. Carter has mostly worked on non proliferation issues and has no ties to any defense contractors.