How Banks Influence People in High Places

This e-mail to Congressional staffers speaks for itself. I am probably being far too nice by omitting the RSVP details. However, I must note the ethics rules for Congress are more lax than those of some private sector companies. I had one client, a Fortune 25 company, that forbade all employees from taking gifts or entertainment of any kind from vendors, down to a cup of coffee. And that’s not as nuts as it sounds. Research by social psychologist Robert Cialdini verifies that a gift as small as a can of soda predisposes the recipient to a sales pitch.

From: The Financial Services Roundtable

Subject: Financial Services University (FSU) Seminars ~ Feb 10-11

Plan to Attend the 2011

Financial Services University (FSU) Educational Series

Thursday, February 10th – Capitol Hill Visitor’s Center – HVC 201

9:00 – 11:00 Banking 101 – An overview of the U.S. banking industry structure and regulation.

11:30 – 2:00 Housing – The basics about mortgages: how they are originated, serviced and securitized; as well as foreclosure prevention and the challenges facing the housing market.

2:30 – 4:00 Retirement Security – An overview of pension and retirement basics, and the challenges our nation faces with respect to individuals’ retirement planning, savings and management.

Friday, February 11th – Capitol Hill Visitor’s Center – HVC 201

9:00 – 11:00 Insurance – Understand the basics of property & casualty and the life insurance industries and how they are regulated.

11:30 – 2:00 Regulatory Reform – A comprehensive look at the current regulatory structure and reform efforts underway; focusing on financial stability oversight council, prudential standards; capital and securities law.

The 2011 Financial Services University (FSU) educational series is sponsored by Financial Services Roundtable member companies. The mission of FSU is to provide congressional staff with basic information on the role of the financial services industry in the U.S. economy and to review financial services issues affecting congressional offices.

Sessions: Each session will consist of an overview of the topic, will build upon previous sessions to provide a comprehensive look at challenges facing the financial industry, and will close with Questions & Answers.

Who Should Attend? All new staffers and staffers who have recently added financial services issues to their portfolio, as well as, the seasoned staffer who wants to learn more about the major areas of importance impacting our nation and economy.

Note: Light refreshments will be served during each educational session, as well as a working lunch available each day. Also, this event has been reviewed by both House and Senate ethics offices.

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  1. DumpTheBankInfoWiki

    Financial Services Roundtable’s high level officer, Honorable John Dalton. This John Dalton is married to Margaret Dalton. There are those wondering if this said, Margaret Dalton is one and the same to the robo-signer Margaret Dalton that works for JPMorgan/Chase.

    Can anybody confirm?

  2. Francois T

    What will never cease to amaze me is the infinite willingness of Congress to get snookered and play for suckers ad infinitum.

    What do I mean by that? Let me answer by an example.

    Up to 1996 (IIRC) Congress had the OTA, Office of Technology Assessment. It was small, budget was microscopic for an entity like the Federal government. However, it was staffed by totally independent and knowledgeable people that KNEW their Sci & Tech very well, and were able to tap into a lots of resources if need be.

    Their unique goal: help Congressperson understanding scientific issues, by answering any questions they might have had.

    It should be pretty darn easy to fathom the value of such an agency, no?

    Well, if you’re a member of We, The People, it is obvious. OTOH, if you’re a member of this ever more hated club call lobbyists, you just don’t want this agency to exist, period!

    The Reichpubliscums, under the aegis of Newt the Puke, shut down the OTA. This has had for effect of leaving special interests groups to literally pollute the scientific-technical infosphere of the whole DC political universe.

    Note that the Democrass, under Obummer, cannot brag too much about being on the side of the facts, accuracy and quality information. They never made any effort to resuscitate the OTA, and create similar Agencies, such as, for instance, (Drum Roll please….!) the Office of Financial Assessment.

    Perish the thought that members of Congress get access to high quality independent information. Isn’t it so much more agreeable to go to “seminars” delivered by industry shills like Sonia La Guapa, or Oleg the Handsome? Imagine that: being treated to easily digestible talking points that are nor too complex, nor too simplistic. Just enough appearance of smart stuff that happens to make, oh surprise! seemingly “good sense” for policy making.

    I mean, we’re far away from the raw complexity, nuances included, of high level topics like health care (Who do you think was the main source of “information” to Congress during the HCR bill battle? The health care insurance lobby) or credit default swaps. That is just too tough to master; furthermore, those who’d work for these now fictitious agencies would be brainiacs, drab and plain looking civil servants…ewwwww!

    Thus, here we are, stuck with a Congress that already contains too many natural worshipers of crass ignorance (Tea Party anyone?) but with members that place a very minimal value on independent, high quality knowledge and information they could easily pay for.

    You just can’t keep a functioning Republic with such a mindset.

    1. Yves Smith Post author

      OK, I’ll put it here, that way I am only somewhat protecting the guilty and rewarding the faithful for reading comments.

      The from line contains a probable contact name:

      From: The Financial Services Roundtable []

      And this is the line I omitted at the close:

      To RSVP for one or all of these sessions contact Liz Organ email or 202.589.2421

  3. F. Beard

    Research by social psychologist Robert Cialdini verifies that a gift as small as a can of soda predisposes the recipient to a sales pitch. Yves Smith

    Less than that:

    To show partiality is not good, because for a piece of bread a man will transgress. Proverbs 28:21

  4. ftm

    The problem here is that for incumbents this is not only appropriate but necessary staff orientation.

    Once elected, the primary task of staff is to raise money to get the boss re-elected. What better way to train your staff than for them to get comfortable with the positions that will maximize the flow of future campaign funds?

    It’s much more pernicious than influence, it’s about funding your boss’s future and your future income.

  5. Ron

    Special interests provides candidate funding, no other inducements are necessary. Here in Calif progressive democrats are aligned with various unions, commercial construction,financial services groups and have used the bond market as their primary weapon of choice. Calif has no debt ceiling so an endless array of bond debt can be generated by cities,counties,special tax districts and of course the state. Want to continue building urban housing tracts on Ag or open space land? no problem fund the necessary water, sewage facilities with bond debt, call it growth or good for business, now comes the build out generating huge profits for various builders,financial service, public/private unions etc. The end result is Calif now has the highest bond debt of any state and if the recent Sonoma county Board of Supervisors decision to issue 290 million bonds to make up pension shortfalls due to stock market losses are any trend it could mushroom into the billions as a recent Stanford study pegged Calif public pension debt around 500 billion.
    The tangled web of growth/political power/debt creation is practiced at a high level in Calif.

    1. ScottS

      California is the most populous state, and still growing. Your point about issuing a lot of bonds, especially during a financial crisis, is moot.

    1. Yves Smith Post author

      Spare me. Your comment proves why this is a bogus alternative. “Left leaning” meaning biased.

      An industry lobbying group is seen as being “objective” and merely presenting expert knowledge when it isn’t.

    2. Billy Bob

      Both Yves and VP have some confusion about how banks – and other industries – influence people, in Congress at least. These industry seminars are not really where the influencing takes place. They are NOT regarded by anyone in Congress as presenting objective, expert knowledge. Groups of all kinds present these sorts of seminars for people who work on Capitol Hill. Everyone knows that the American Petroleum Institute is going to have a different take on energy production than the Apollo Alliance.

      Where bankers (similarly to other corporations) put the screws to politicians is when a regional representative from ABA shows up in your office with the presidents of three small banks in your state or district, all spouting the ABA line, despite the fact that you know that their interests do NOT coincide with those of the big banks that run ABA. It is hard to tell your constituents that they are being duped and keep their support. But the clincher is when the ABA gives money to your opponent and recommends that a lot of those constituent bankers do too. Moreover, in the case of bankers, they are in touch with a lot of other business people among constituents and influence their opinions, votes and donations. It is just easier and safer to take the money and go with the flow. But it’s a long-term disaster for the nation.

      Possible solutions, or at least mitigations, include restoring the Fairness Doctrine or some other means of taking money out of politics; getting more wealthy liberals – and they are out there – to understand the necessity of setting up institutions to rival the right’s; to reinvigorate labor unions; or at a minimum to revoke McCain-Feingold. BCRA makes politicians sell out to the entire class of wealthy people.

        1. Billy Bob

          Just in case you are still in the vicinity, jonboinAR, the answer is that by restricting the amount per individual donor when so much money is required to buy television time, BCRA (McCain-Feingold) forces candidates to become beholden to a wider spectrum of wealthy people. The example I use that in the old days, Mark Hanna could walk up to President McKinley and give him a check for $1,000,000, enough to run his 1900 presidential campaign. McKinley had only thereby sold his soul to John D. Rockefeller. Nowadays, congressional candidates have to raise roughly the same amount in $2,500 maximum increments. At maximum efficiency, that is 200 individual donors who can afford to give a candidate $2,500 twice within two years, or 100 PACs at $5,000 and $5,000. It is just easier to raise that kind of money in larger lots – think of trying to get $20 each from 50,000 individuals. The problem is that this gives a breadth of wealthy individuals, corporations and capstone organizations a tremendous amount of leverage over an individual candidate, over most candidates, and therefore over the entire system.

  6. Billy Bob

    Industry lobbying groups are certainly not seen by Congressional offices as being “objective” and “merely presenting expert knowledge.” Even the stupidest, most naive offices know better than that. The evil industry lobbying group seminars accomplish is much more closely related to what ftm says above: the need to raise money and for LA’s who cover an industry’s issues to learn what to support and what to oppose in order to do that.

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