Even though the odds are against the Democrats retaking the House of Representatives, the jockeying in case that event takes place is already underway. An effort is afoot to push aside the Democratic heir presumptive of the powerful House Financial Services leadership, Maxine Waters, and install the representative from the Upper East Side’s Silk Stocking district, Carolyn Maloney.
What’s striking about the effort to take down Waters is the thinly disguised racism. To put none too fine a point on it, Waters is not culturally white, like Obama or Colin Powell, nor is she well spoken like, say, one of my favorite former Representatives, Cynthia McKinney. She’s from the wrong side of the tracks class-wise as well as color-wise.
Of course, to make this sort of bigotry socially acceptable, it’s presented as a style problem. As I pointed out long form in a well-received article for the Conference Board Review, stylistic concerns are an effective way to keep to minorities out of leadership positions. It’s a requirement that candidates maintain a particular class veneer. Out groups typically find it difficult to wear the expected behavior gracefully if they didn’t learn it while they were growing up.
This article from Politicker presents an anti-Waters diatribe. It is remarkably transparent in taking a bank point of view, and makes no pretense to be neutral:
Why the worry about Ms. Waters as the nation’s chief banking regulator? It doesn’t stem from comments she made in her first term in office, when she suggested that the Rodney King riots that occurred in her neighborhood would better be thought of as a “rebellion”—since “riot,” she maintained, “sounds like it was just a bunch of crazy people who went out and did bad things for no reason. I maintain it was somewhat understandable, if not acceptable.” And it doesn’t stem from her more recent suggestion that “The Tea Party can go to hell” a suggestion appended by the promise that “I intend to help them get there.”
This is quite the little hatchet job. First, the chair of the House Financial Services committee is NOT a regulator. Overstating the chair’s power is a way to make her seem more of a dragon-lady-in-waiting than she would otherwise be. Second, get a load of the “Oh, we’re not making a gratuitous bigoted slam” of implying she’s a little too close to her people of color constituency while claiming that’s not an issue. If it’s not an issue, why mention it at all, let alone give it the pride of place in your “What’s wrong with Waters” case?
But the flip side is I applaud her remarks on the Tea Party. The fact that this sort of remark is held against her reflects the fact that mainstream Dems sell out to corporate interests under the guise of “compromise.” Someone who demonstrates that frontal opposition to the right can work would undermine the party’s preferred diversionary tactic.
The story continues:
Rather, most of the concern stems from what is perceived as a general hostility to the banking industry, if not to the economic system as a whole.
“She is wacko,” said one New York banking lobbyist. “She is very flamboyant, very old school. She is not one of these younger, sophisticated members of Congress. She has no grasp of the technical side of finance. She was elected during a different time in history and she hasn’t read a book since.”
The corridors of Wall Street’s financial firms are filled with stories of Ms. Waters privately and, in some cases, publicly browbeating executives over what many see as issues outside of their firms’ purview.
“Most of the international banks would start folding their tents” if Ms. Waters were to became chair of the committee, said John Allen James, the executive director of Pace University’s Center for Global Governance, Reporting and Regulation and a former consultant for McKinsey. “She is anti-bank. She doesn’t like anybody that wears a suit and a tie. She yells at them, and says why aren’t you doing more to address the housing problem, why aren’t you doing more to raise the boats of the less fortunate. It is a total misunderstanding of what capitalism is.”
If you are outside the 1% or are not somehow a big beneficiary of the banking industry, you ARE hostile to the banking industry. It’s remarkable how insular the view of financial services industry incumbents has become. If you’ve been looting the community at large, it should not come as a surprise that someone who represents a constituency of not less than affluent people would not be sympathetic to your views.
And notice the subtext of this and the earlier extract: that the banks somehow have the right to have Congressional committees promote their interests, as opposed to draft regulation that promotes a sound, responsible banking industry. Oh, and the whopper that banks are capitalist enterprises! Given how banks got considerable subsidies from the government before the crisis, and are so dependent on state support in the wake of the crisis (starting with ZIRP) as to no longer be properly considered to be private enterprises, Waters’ instincts are correct. The banks haven’t come close to acknowledging or acting on their responsibilities to taxpayers and communities.
We also have a straw man: “no grasp of the technical side of finance.” Earth to base, no Congressman does. Some may have a bit of knowledge in certain areas by dint of previous experience (for instance, Dick Shelby used to own a title company, and that is probably not unrelated to the dim view he has taken of MERS and securitization). Given the complexity of modern finance, and the fact that Congresscritters have broad ranging responsibilities, it’s ridiculous to expect them to be experts on tradecraft. They rely on their staffers to do technical investigations and provide briefings and recommendations.
The real beef with Waters is that she and her staffers don’t take up bank lobbyist pet issues and talking points. And that’s the reason for preferring Maloney. Her district includes zip code 10021, which includes many of the most exclusive buildings in Manhattan, such as 720 and 740 Park Avenue, whose residents either are directly or indirectly beholden to Wall Street.
The Politicker story discusses Water’s input into Dodd Frank, that of a provision requiring more minorities and women be hired, which is criticized (by a Republican) as “radically changing employment law.” That might well be necessary, given that various court decisions have vitiated anti-discrimination statutes particularly ones making it harder to file class action litigation. Successful discrimination suits involving lower level employees produces only small awards, reflecting their modest salaries, and hence aren’t worth pursuing on a case-by-case basis.
What is more revealing is the article is silent on the real Waters controversy, that of a possible ethics violation involving her seeking assistance during the crisis for minority owned-bank OneUnited, in which her husband had a sizable equity stake. Waters loudly maintains her innocence and wants a trial. The investigation may be fatally compromised by virtue of two staffers on the Ethics Committee leaking confidential information to Republicans on the panel.
But why the failure to point out an obvious Achilles heel? Waters apparently realized early on her pumping for OneUnited might not pass the smell test and she backed off. It looks as if Barney Frank took up the effort on her behest. But Frank claims he was already on the case at the behest of scandal-ridden state senator Dianne Wilkerson, not Waters. And it isn’t as if the former House Financial Services Committee chairman was a paragon of propriety. He pushed to get his partner Herb Moses a job at Fannie Mae in the early 1990s, and was an aggressive defender of the GSE during (and after) his seven-year tenure there.
Let’s face it. The big problem with Maxine Waters isn’t that she’s not the most adept presenter or that she isn’t a technician. It’s that she’s seen through her constituency all the games banks play to exploit ordinary consumers, and she’s not buying slick banker patter as to why she should ignore it. And that’s why, warts and all, she’s the best candidate on offer for the Financial Services Committee chair for American citizens.