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A Fine-Ass Committee

Americans, who says your government isn’t working hard for you? Just look at the House Committee on Financial Services: they are the hardest workin’ folks in Washington. This statement is especially true if by “House Committee on Financial Services,” you actually mean “big bank lobbyists.” 

Consider this: The House of Representatives is set to approve two new bills on Wednesday that would weaken derivatives regulations put in place by the 2010 Dodd-Frank financial reform bill. The success rate for similar regulatory laxatives has been mighty high in the House this year. “Of 10 recent bills that alter Dodd-Frank or other financial regulation, six have passed the House this year,” writes the New York Times. “This week, if the House approves Citigroup’s legislation and another bill that would delay heightened standards for firms that offer investment advice to retirees, the tally would rise to eight.”

The Senate, on the other hand, doesn’t have any public plans to vote on these bills—though, who knows, the Senate could always tack these regulatory reforms on to another bill. For its part, the White House says it won’t sign any of these softeners. So what’s the point of drafting and passing these measures? For House lawmakers, especially those on the Financial Services Committee, the point is pretty clear: these dumb banks will give lawmakers insane amounts of money to vote for things, even if it’s clear they have no intention of making them law.

The banks make it nice and easy for our poor, overworked representatives in Washington. A Times Dealbook post in May described how Citigroup—such a mensch, this bank—was kind enough to do all the legwork for (at least) one deregulatory measure that then “sailed through” the committee:

One bill that sailed through the House Financial Services Committee this month—over the objections of the Treasury Department—was essentially Citigroup’s, according to e-mails reviewed by the New York Times. The bill would exempt broad swathes of trades from new regulation.

In a sign of Wall Street’s resurgent influence in Washington, Citigroup’s recommendations were reflected in more than seventy lines of the House committee’s eighty-five-line bill. Two crucial paragraphs, prepared by Citigroup in conjunction with other Wall Street banks, were copied nearly word for word—lawmakers changed two words to make them plural.

These banks are such little helpers that they even take care of drafting questions the lawmakers plan to ask ahead of committee hearings with bank executives. As the Times reported this week,

when bank executives are called to testify before Congress, industry lobbyists distribute proposed questions to lawmakers and their staff, seeking to exert some control over the debate, according to emails written by staff members on the House Financial Services Committee that were reviewed by the Times.

Yet another email warned lawmakers not to “mimic” lobbyists’ talking points too closely.

Then there are the usual private-room dinners near the Capitol with bank executives and lobbyists, as well as tours of major bank headquarters for starry-eyed freshman legislators.

And, of course, there’s the money. The dough. The House Financial Services Committee’s chief role, it seems, is to pass as many bank-written measures as possible so that everyone in the House gets the chance to make a little money. And this is where the Democrats get the best deal of all. If the votes on the House floor for these deregulatory measures were expected to be competitive, they might be pressured into voting against them. But they’re not competitive — Republicans already provide the majority to pass them. Then, as one Democratic aide told the Times, the only thing left to do is whip out the collection plate.

House aides, when asked why Democrats would vote for this proposal even though the Obama administration opposes it, offered a political explanation. Republicans have enough votes to pass it themselves, so vulnerable House Democrats might as well join them, and collect industry money for their campaigns.

“It is a free vote,” one aide explained Monday.

Hey guys, why not just hold out for the literal belly rub?