Doherty channels his inner Elizabeth Warren
Brendan Doherty is breaking with conservative Republican orthodoxy on financial reform. In a statement, Doherty cites the J.P. Morgan Chase $2 billion trading loss and calls on Congress to enact Wall Street reform and reinstate the Glass-Steagall wall between commercial and investment banking.
“The latest multi-billion dollar trading debacle by J.P. Morgan, one of our largest financial institutions, shows that Wall Street has not learned the lessons from the Great Recession,’’ says Doherty.
“It also highlights the federal government’s failure to enact real and necessary rerfom of our financial sector,’’ said Doherty. “Instead, Congress passed the massive and loophole-ridden Dodd-Frank law which was an open invitation for Wall Street to hire lobbyists to write its own rules and regulations.’’
Doherty goes on to assert that “the partnership between Wall Street and Congress is exactly the kind of crony capitalism that endangers free enterprise and the principles of economic opportunity that America is supposed to stand for.’’
The Glass-Steagall firewall was razed during the administration of Democrat Bill Clinton after prodding from Republicans, particularly then-Sen. Phil Gramm of Texas. (Clinton has since said signing the measure into law was a mistake). Democratic incumbent David Cicilline, Doherty’s likely general election opponent, has signed on to legislation that would reinstate this regulation.
But tougher financial rules on large banks have been largely thwarted by Republicans in Congress, despite calls from Democratic leaders and the Obama White House for stronger regulations on `too-big–to-fail’’ financial institutions.
In the aftermath of the J.P. Morgan trading mess, Doherty’s stance is probably smart politics in the Rhode Island 1st Congressional District. Ironically it is much the same tack that Democrat Elizabeth Warren has taken against Republican Scott Brown in Massachusetts marquee U.S. Senate election.