On Thursday, President Obama announced his commitment to pass sweeping legislation to reform Wall Street and to create a new regulatory structure meant to avert another economic crisis. However, the financial industry is fighting back, hoping to obstruct legislation, water down the bill, and possibly kill effective reform.
The legislative battle is multifaceted. Frank Luntz, a consultant who is paid by financial services firms, wrote a messaging memo now used by opponents of reform to confuse the public and smear the legislation. As Talking Points Memo revealed earlier this week, a K Street PR firm known as the DCI Group — with ties to Wall Street — is working with a front group to run ads against reform. And recently, Republicans have met with top bankers and representatives from the banking industry to trade campaign dollars for a promise to fight reform.
However, as with the health reform debate, there is a large, more subterranean effort from industry to kill reform. As the Politico Playbook reported yesterday morning, “financial-services giants are going grassroots” to lobby against reform. ThinkProgress has learned that the banks and financial conglomerates are using the same stealth lobbying operation the health insurance industry employed last year to mobilize opposition. Bank of America, JP Morgan Chase, Master Card, and other industry players are working through “Democracy Data & Communications” (DDC) — a firm that specializes in helping corporations activate their employees and customers into grassroots advocates — to join the U.S. Chamber of Commerce’s effort to kill reform. The domain list of the DDC server, obtained by ThinkProgress, contains various Wall Street websites, including one seemingly named after JP Morgan CEO Jamie Dimon, which all transfer visitors to the Chamber’s anti-reform campaign:
USAA, the financial services corporation, also employs DDC for its grassroots lobbying and mass e-mailed its customers Friday morning to call lawmakers and oppose reform (view a copy here). Last year, DDC helped JP Morgan Chase coordinate a stealth campaign to kill efforts to tax banker bonuses.
The banks are conducting a two-faced campaign to kill reform. In public, the banks pledge to fully support reform. However, behind closed doors, the banks — many of which were bailed out with TARP money and have not paid back taxpayers — are funding the Chamber’s attack ads and are connecting their network to the Chamber’s grassroots lobbying campaign.
The Chamber’s agenda on Wall Street reform is clear. On Wednesday, the Chamber’s political director Bill Miller met with Wall Street executives, Karl Rove, and other Republican operatives. The next day, Miller fired off an e-mail directing Chamber members to fight reform, declaring that the Chamber “fundamentally” disagrees with President Obama’s approach and that the legislation cannot be improved. Miller characterized reform as a “federal takeover of our financial industry” that “won’t do the one thing America needs most: create jobs.” Of course, the Chamber was one of the main lobbying fronts used by Wall Street to deregulate the financial markets under President Bush — and then demanded bailouts as the market crashed.
Indeed, despite having helped to cause the financial crisis, the Chamber has been running at least $3 million dollars worth of ads against reform, and is also paying high-priced consulting firms to lobby against reform on Capitol Hill.
We’ve seen this act before. Health insurance companies told the President, the media, and the public that they would fully support efforts to reform the healthcare system. However, starting in 2009, health insurance companies laundered up to $20 million dollars through the Chamber to run anti-health reform ads, used firms like DDC to scare customers and send their employees to anti-health reform town halls and rallies, and worked closely with front groups to viciously smear reform legislation.