Wall Street may own the GOP, but Wall Street investors REALLY pay attention to politics when it comes to what effect politics will have on economic activity.

Investors know that if the government stops spending right now economic activity will slow down.  That’s bad for equity prices in particular, and commodity prices too if the slowdown looks severe enough.   So failure to reach some ‘grand bargain’ where spending is severely curtailed is not a bad thing from an investor standpoint. 

Europe, on the other hand, bothers investors a great deal.  Why?  Because Europe is the world’s largest economy taken as a whole.  And the biggest customer for US products.  If Europe sinks back into recession it will hurt US companies, irrespective of whatever negative effects weakened European banks might produce.  

Domestically, the Feds need to keep spending and if that spending directly hires unemployed people the domestic economy is guaranteed to strengthen more quickly.  Obama is touring the country beating the drum for his latest stimulus, one that directly hires and is guaranteed to put people back to work.  If he is successful, the country will benefit.

And so too will equities benefit.  Austerity, on the other hand, will sink the economy and equity prices too.

Forgive what is likely to be a rambling, stream of conscious type of post, but from our distant view of the national stage play it appears that Treasury Secretary Tim Geithner should be allowed to keep playing his role–especially to provide continuity because several major players have already left or are about to leave the stage, among them chief economic counselor economist Larry Summers, and President Obama’s main political counselor, Chief of Staff Rahm Emanuel.

From the beginning, when Geithner was before Congress as a nominee for Treasury Secretary, we were struck by his seeming obsession with details.  Geithner struggled to explain to Congress why he believed it was important to establish a robust, more open market in derivatives.  These were the financial ‘innovations’ many believed were at the heart of the nation’s economic meltdown.  Innovations that were labeled  ‘instruments of mass destruction’ by iconic billionaire investor Warren Buffett.  Innovations that many still believe should be prohibited.

His first appearance, in part because he was trying to explain how he’d regulate securities few understood well, was declared a weak one.  From our seat we were more impressed by his stubborn effort to explain even as it became clear few were able to follow his explanations.  We referred to him as ‘terribly thorough Timmy’ in a large part due to our impression of his early Congressional appearances.

From that point forward, Geithner has made an impressive series of moves, often in concert with Fed. Chairman Ben Bernanke.  The number of programs he’s developed his first two years, when looked back on in it’s entirety, is extraordinary–and thorough.  If there was a struggling piece of the economy, and there were many such pieces, Geithner would come up with a program of support.  If it didn’t work as well as he wished, he experimented.  From what he’s done already, historians will no doubt put him in the top list of activist Treasury Secretaries.  

And from time to time he’s been a very effective spokesman for the Obama administration.  The most recent example being a Washington Post opinion piece entitled  ’Treasury Secretary Timothy Geithner tackles five myths about TARP’ (Troubled Asset Recovery Program dubbed the ‘bailout’ of Wall Street). 

From that article’s intro: “The TARP was doomed to be unpopular from inception, because Americans were rightfully angry that the same firms that helped create the economic crisis got taxpayer support to keep their doors open. But the program was essential to averting a second Great Depression, stabilizing a collapsing financial system, protecting the savings of Americans and restoring the flow of credit that is the oxygen of the economy.  And it helped achieve all that at a lower cost than anyone expected.”

Geithner then goes on to explain how the vilified program is a strong candidate to be the most successful program of all the programs aimed at fighting the recession.  And he has the skill not only to explain, but to skewer political opponents at the same time.  But not in a mean way.

“The TARP was created by a conservative Republican president, who was also forced by the crisis to take over Fannie Mae and Freddie Mac, lend billions to the automobile industry and guarantee money-market funds. And the TARP was championed by the same Republican congressional leaders who are in office today. They deserve more credit for the courage they showed than they seem willing to accept now.”

Touche’ Timmy.

From most reports Geithner supported the establishment of a strong Consumer Financial Products Commission, to which the popular Elizabeth Warren has been appointed as interim head.  This was an unpopular idea within the banking establishment.  Supporting Warren was just one of Geithner’s public moves that bolster his reputation as a regulator.  Geithner never tires of reminding the public, and Wall Street, that he is not a banker.  While critics of cross pollination between Wall Street and Washington abound and Geithner often automatically gets tossed into this long list, this and other Geithner moves indicate he doesn’t belong in that category.  He’s a real regulator.  A bureaucrat who doesn’t  check his brain in the lobby when he goes into work. 

We now have the opinion that when Geithner enters a room full of  Wall Street ‘masters of the universe’ it’s not Geithner who becomes anxious.  In other words, he’s become comfortable with the power that is embodied in the US Secretary of the Treasury, a power that exceeds those of even the most powerful and wealthy investment bankers–the power to regulate, the sacrosanct power of the body politic.  Geithner knows he can put these folks out of business.  And they do too.

Another reason for keeping Geithner on the job is his familiarity, comfort if you will, with eastern developing economies and their politics.   From his bio on Wikipedia:

“Geithner was born in Brooklyn, New York to his parents, but spent most of his childhood in other countries, including present-day Zimbabwe, Zambia, India, and Thailand where he completed high school at the International School Bangkok.^[4] He attended Dartmouth College, in the tradition of his father and paternal grandfather, graduating with an A.B. in government and Asian studies in 1983.^[4] In the process he studied Mandarin at Peking University in 1981 and at Beijing Normal University in 1982.^[5] He earned an M.A. in international economics and East Asian studies from Johns Hopkins University’s School of Advanced International Studies in 1985.^[4][6] He has studied Chinese^[4] and Japanese.^[7]

How fortuitous is it that at a time of ascending Chinese economic and political power, the US Treasury Secretary brings this level of familiarity to his job?  Practical understanding of one’s economic competitors represents an invaluable advantage for the country. 

To sum up.  Geithner has demonstrated his independence of Wall Street.  He understands Wall Street’s value certainly, but he understands his regulatory mantle as well and has shown a tough willingness to use that power.  He is now comfortable with the job.  It shows in his public appearances both here and abroad.  He doesn’t shirk from what he thinks is important, even if it sometimes means he will be perceived as stubborn or unfair, not only domestically but in foreign arenas.   And he brings a hard-to-duplicate familiarity, including a sense of nuance, with a part of the world most Americans don’t understand.

Although it’s a perception from a long distance away, and without the benefit of binoculars, it appears Secretary Geithner is thorough.  He is that ‘terribly thorough Timmy’ we wrote of now almost two years ago.

Obama should make it clear Geithner’s going to remain Treasury Secretary.  Today and for a long time to come.

A New York Times article on hearings before the Financial Crisis Inquiry Commission reports the commission is receiving testimony essentially proving that credit rating agencies willfully ignored evidence that mortgage securities being sold were increasingly full of sketchy mortgages.

The testimony also shows that Wall Street bankers willfully ignored the same evidence as they continued to sell the untrustworthy securities.  In fact, the banks used their knowledge to get price cuts from mortgage originators but instead of passing along these discounts to clients they continued to charge full price and pocketed the difference to fatten profits.

From the article, written by journalist Gretchen Morgenson:

“The commission, a bipartisan Congressional panel, has been holding hearings on the origins of the financial crisis. D. Keith Johnson, a former president of Clayton Holdings, a company that analyzed mortgage pools for the Wall Street firms that sold them, told the commission on Thursday that almost half the mortgages Clayton sampled from the beginning of 2006 through June 2007 failed to meet crucial quality benchmarks that banks had promised to investors.

Yet, Clayton found, Wall Street was placing many of the troubled loans into bundles known as mortgage securities….

It has been more than four years since Mr. Johnson and his colleagues at Clayton Holdings started noting that disturbing numbers of mortgages did not meet the lending criteria promised to investors in prospectuses used to market the securities.

Details of what Wall Street firms knew about the loans they were selling to investors, and when they knew it, are still trickling out in regulatory actions and private lawsuits.

The Massachusetts attorney general recently accused Morgan Stanley of deceptive practices in its financing of mortgage lenders during this period, saying that the firm had knowingly placed dubious mortgages into securitized pools. Morgan Stanley settled with the attorney general in June and paid $102 million. The facts in that case relied on Clayton reports of loan quality commissioned by Morgan Stanley.

But until Mr. Johnson’s testimony last week, it was largely unknown that the ratings agencies had been told that vast numbers of loans were being packaged as securities even though they failed to meet underwriting standards.

Before assembling mortgage pools, brokerage firms hired independent analytical companies like Clayton to sample loans and flag any that were problematic. Clayton was one of two large due diligence companies that watched for loans that did not meet specifications like geographic diversity and the loan-to-value ratios between a mortgage and the home that secured it, as well as the credit scores and incomes of borrowers.

It was a trust-but-verify approach to a lucrative business, a way for Wall Street to look over the shoulders of lenders whose operations they did not control but whose mortgages they were buying nonetheless.

According to testimony last week, from January 2006 to June 2007, Clayton reviewed 911,000 loans for 23 investment or commercial banks, including Citigroup, Deutsche Bank, Goldman Sachs, UBS, Merrill Lynch, Bear Stearns and Morgan Stanley.

The statistics provided by these samples, according to Mr. Johnson and Vicki Beal, a senior vice president at Clayton who also testified before the inquiry commission, indicated that only 54 percent of the loans met the lenders’ underwriting standards, regardless of how stringent or weak they were.

Some 28 percent of the loans sampled over the period were outright failures — that is, they were unable to meet numerous underwriting standards and did not have positive factors that compensated for their failings. And yet, 39 percent of these troubled loans still went into mortgage pools sold to investors during the period, Clayton’s figures showed.

The results variedfrom firm to firm. At Citigroup, for example, 29 percent of the sample failed to meet underwriting standards over the period, but almost a third of those substandard loans made it into securities pools.

At Goldman Sachs, 19 percent of loans failed to make the grade in the final quarter of 2006 and the first half of 2007, but 34 percent of those loans were still sold by the firm. Throughout this period, Goldman Sachs was also betting against the mortgage market for its own account, according to documents provided to government investigators.”

Beezer here.  All this just shows that ethics collapsed long before the market collapsed.  Today, the stock markets complain about low volume.  Of course it’s low.  Investors now understand not to trust Wall Street.  Fleecing unsuspecting investors is a business model on Wall Street, and apparently has been one for a long time.

Flash crashes, intentionally mispriced securities–no wonder investors are seeking safety and avoiding risk.  The markets are rigged.  The professionals involved are now painted with the same brush of suspicion and stamped ‘not credible.’  They’ve all earned it. 

Former Labor Secretary under President Bill Clinton, Prof. Robert Reich, has written a strong and direct post about America’s underlying, foundational problem:  The growing disparity in incomes.

“We’re back to the same ominous trend as before the Great Recession: a larger and larger share of total income going to the very top while the vast middle class continues to lose ground.

And as long as this trend continues, we can’t get out of the shadow of the Great Recession. When most of the gains from economic growth go to a small sliver of Americans at the top, the rest don’t have enough purchasing power to buy what the economy is capable of producing.

America’s median wage, adjusted for inflation, has barely budged for decades. Between 2000 and 2007 it actually dropped. Under these circumstances the only way the middle class could boost its purchasing power was to borrow, as it did with gusto. As housing prices rose, Americans turned their homes into ATMs. But such borrowing has its limits. When the debt bubble finally burst, vast numbers of people couldn’t pay their bills, and banks couldn’t collect.

Each of America’s two biggest economic downturns over the last century has followed the same pattern. Consider: in 1928 the richest 1 percent of Americans received 23.9 percent of the nation’s total income. After that, the share going to the richest 1 percent steadily declined. New Deal reforms, followed by World War II, the GI Bill and the Great Society expanded the circle of prosperity. By the late 1970s the top 1 percent raked in only 8 to 9 percent of America’s total annual income. But after that, inequality began to widen again, and income reconcentrated at the top. By 2007 the richest 1 percent were back to where they were in 1928—with 23.5 percent of the total…..

“What we get from widening inequality is not only a more fragile economy but also an angrier politics. When virtually all the gains from growth go to a small minority at the top — and the broad middle class can no longer pretend it’s richer than it is by using homes as collateral for deepening indebtedness — the result is deep-seated anxiety and frustration. This is an open invitation to demagogues who misconnect the dots and direct the anger toward immigrants, the poor, foreign nations, big government, “socialists,” “intellectual elites,” or even big business and Wall Street. The major fault line in American politics is no longer between Democrats and Republicans, liberals and conservatives, but between the “establishment” and an increasingly mad-as-hell populace determined to “take back America” from it.”

The structural problem began in the late 1970s when a wave of new technologies (air cargo, container ships and terminals, satellite communications and, later, the Internet) radically reduced the costs of outsourcing jobs abroad. Other new technologies (automated machinery, computers and ever more sophisticated software applications) took over many other jobs (remember bank tellers? telephone operators? service station attendants?). By the ’80s, any job requiring that the same steps be performed repeatedly was disappearing—going over there or into software. Meanwhile, as the pay of most workers flattened or dropped, the pay of well-connected graduates of prestigious colleges and MBA programs—the so-called “talent” who reached the pinnacles of power in executive suites and on Wall Street—soared.

The puzzle is why so little was done to counteract these forces. Government could have given employees more bargaining power to get higher wages, especially in industries sheltered from global competition and requiring personal service: big-box retail stores, restaurants and hotel chains, and child- and eldercare, for instance. Safety nets could have been enlarged to compensate for increasing anxieties about job loss: unemployment insurance covering part-time work, wage insurance if pay drops, transition assistance to move to new jobs in new locations, insurance for communities that lose a major employer so they can lure other employers. With the gains from economic growth the nation could have provided Medicare for all, better schools, early childhood education, more affordable public universities, more extensive public transportation. And if more money was needed, taxes could have been raised on the rich.

Big, profitable companies could have been barred from laying off a large number of workers all at once, and could have been required to pay severance—say, a year of wages—to anyone they let go. Corporations whose research was subsidized by taxpayers could have been required to create jobs in the United States. The minimum wage could have been linked to inflation. And America’s trading partners could have been pushed to establish minimum wages pegged to half their countries’ median wages—thereby ensuring that all citizens shared in gains from trade and creating a new global middle class that would buy more of our exports.

But starting in the late 1970s, and with increasing fervor over the next three decades, government did just the opposite. It deregulated and privatized. It increased the cost of public higher education and cut public transportation. It shredded safety nets. It halved the top income tax rate from the range of 70–90 percent that prevailed during the 1950s and ’60s to 28–40 percent; it allowed many of the nation’s rich to treat their income as capital gains subject to no more than 15 percent tax and escape inheritance taxes altogether. At the same time, America boosted sales and payroll taxes, both of which have taken a bigger chunk out of the pay of the middle class and the poor than of the well-off.

Companies were allowed to slash jobs and wages, cut benefits and shift risks to employees (from you-can-count-on-it pensions to do-it-yourself 401(k)s, from good health coverage to soaring premiums and deductibles). They busted unions and threatened employees who tried to organize. The biggest companies went global with no more loyalty or connection to the United States than a GPS device. Washington deregulated Wall Street while insuring it against major losses, turning finance—which until recently had been the servant of American industry—into its master, demanding short-term profits over long-term growth and raking in an ever larger portion of the nation’s profits. And nothing was done to impede CEO salaries from skyrocketing to more than 300 times that of the typical worker (from thirty times during the Great Prosperity of the 1950s and ’60s), while the pay of financial executives and traders rose into the stratosphere.”

Reich blames both Republicans and Democrats.  When it comes to the disheartening spread in wealth towards the wealthy and away from the rest of the country, both parties turned a blind eye to the problem.

And he says a likely result will be angrier politics as the public, not being able to connect the dots accurately, will strike out at anyone in government.

Reich warns that the likely result will be unpleasant for everyone, including the wealthy.  Beezer agrees.  The political backlash will not benefit anyone, except briefly a few political opportunists. 

Simon Johnson and James Kwak, co-authors of the blog The Baseline Scenario, have published a new book entitled “13 Bankers: the Wall Street Takeover and the Next Financial Meltdown.”   It is, far and away, the best explanation of how America developed an Oligopoly in banking, and why this Oligopoly created the 2008 near total collapse in finance.

Johnson in particular has the real world experience in banking.  He was the International Monetary Fund’s chief economist and in that job witnessed first hand the problems countries can encounter when their banks become politically powerful, wedding themselves to the political establishment in order to cement their control of a nation’s finance.  Currently he is Ronald A. Kurtz Professor of Entrepreneurship at MIT’s Sloan School of Management and a senior fellow of the Peterson Institute for International Economics.

Kwak is no slouch either.  He has an undergraduate degree from Harvard, a Ph.D. from the University of California, Berkeley  (in French intellectual history, no less) and is in the process of gaining his law degree from Yale.  Along the way he became a successful software entrepreneur.

The book is much more than a blow by blow description of the collapse.  It provides an historical recounting of what has been a conflict in America since her inception.  Johnson and Kwak, from the book’s cover: “…give a wide-ranging, meticulous, and bracing account of recent US financial history within the context of previous showdowns between American democracy and Big Finance: from Thomas Jefferson to Andrew Jackson, from Theodore Roosevelt to Franklin Delano Roosevelt.  They convincingly show why our future is imperiled by the ideology of finance (finance is good, unregulated finance is better, unfettered finance run amok is best) and by Wall Street’s political control of government policy pertaining to it.”

Through one crisis after another in America’s financial history,  US President’s have struggled against the threat(s) a financial industry can bring against democracy.  During the 20th century it was the Democrat party that traditionally took the lead in trying to effectively regulate banking and high finance.

Finance has always had the money it needed to try and buy votes–yesterday and today.  Daniel Webster once wrote to the powerful banker Nicholas Biddle, “I believe my retainer has not been renewed or refreshed as usual.  If it be wished that my relation to the Bank should be continued, it may be well to send me the usual retainers.” 

Imagine something like that being uncovered in an email between a US Senator and, as an example, Lloyd Blankfein at Goldman Sachs.  That both Blankfein and the Senator would have to immediately resign, and possibly serve some jail time, shows that the conflict between democracy and finance power brokers remains to this day. 

Nevertheless, finance still has the most money of any industry.  Finance is, far and away, the largest contributor to political campaigns.  It, again by a wide margin, supports the largest cadre of lobbyists in Washington DC.   High finance executives regularly serve at the highest level of the political power establishment–Democrat as well as Republican.  And this well known “revolving door” works the other way as well.  Like-thinking bureaucrats regularly walk out of their jobs into much higher paying positions in the financial industry.

But something has changed recently, particularly since the Presidency of Ronald Reagan in the 1980s.  The chronic push and pull battle between finance and democracy took a new twist.  For the first time, finance was gifted a political pass that was not tethered to its already powerful ability to spread the money around. 

From the book:  “Although Jimmy Carter had overseen the beginnings of deregulation with airlines, railroads, and trucking, it was more a topic for policy wonks than for the broader electorate; drawing in part on the ideas of economist Milton Friedman, Reagan made deregulation an ideological crusade.  Like so many successful leaders, Reagan managed to bring together many conflicting movements and beliefs in his coalition.  But his central message, as he said in his first inaugural address, was that ‘government is not the solution to our problems; government is the problem.’”

Brilliant.  Armed with an intellectual economic philosophy espoused by Friedman and the so-called “Chicago School” of economics, Reagan began the dismantling of restrictions put in place under FDR during the Great Depression.  Democrats still resisted, and Reagan didn’t win all his proposals to deregulate finance, but the great unraveling had begun in earnest.  For the first time, bankers had the upperhand not only in money but in ideology.  The process of “intellectual capture,” of Washington by Wall Street was underway.

The final nail in the building of a regulatory capture coffin for democracy came when Wall Street discovered it could use it’s new found freedom to boost something near and dear to Democrat hearts:  Home ownership.  Using the securitization of mortgages, and the resulting explosion of derivative use, deregulated banks and non banks flooded the mortgage market with money.  Rates were low, then lower and long held fiduciary standards for home ownership were discarded almost completely.

Fifty years of banking stability, of the almost complete absence of financial turmoil in America, was about to come to an end.  The final bulwark against financial oligarchy in America, the Democrat party, was compromised.  Neutered.

Read the book.  It’s easy to follow, even when the derivatives are explained.  And it is thorough, recording the history as well as the underlying intellectual battle over deregulation. 

Next.  What to do?

There are some US Senators who understand what’s really needed to put our economic ship on a more stable course.

Following is a proposed regulation from four Senators, all Democrats.  The proposed legislation is called SAFE Banking Act of 2010.

April 21, 2010

WASHINGTON D.C. – U.S. Senators Ted Kaufman (D-DE) and Sherrod Brown (D-OH), with Robert P. Casey (D-PA), and Sheldon Whitehouse (D-RI) today announced new legislation that would place reasonable caps on the size of our nation’s behemoth financial institutions. Their bill, The SAFE Banking Act of 2010, would also ensure that banks have the resources to cover their losses. The senators explained why Wall Street reform is needed to hold Wall Street accountable, prevent future bailouts, and protect American homes, jobs, pensions, and businesses.
“We can either limit the size and leverage of  ’too big to fail’ financial institutions now, or we will suffer the economic consequences of their potential failure later. Breaking apart too-big-to-fail banks is the necessary first step in preventing another cycle of boom-bust-and-bailout.  This debate is a test of whether the power of that idea can spread and gain support,” said Kaufman.

“Though it is clearly the safest way to avoid another financial crisis, this idea must overcome tremendous resistance from Wall Street banks and their politically powerful campaigns against structural financial reform,” Kaufman continued. “Moreover, the idea must overcome the inertia and caution in a Congress drawn to easier ideas that may work. But how much should we gamble that they will work? Limiting size and leverage are redundant fail-safe provisions to prevent a dangerous outcome. Senator Brown and I are proposing a complementary idea, not a substitute.”

 
“If we’re going to prevent big banks from putting our entire economy at risk, we need to place sensible size limits on our nation’s behemoth banks. We need to ensure that if banks gamble, they have the resources to cover their losses,” Brown said.

“The SAFE Banking Act prevents megabanks from controlling too much of our nation’s wealth – no one investment bank or financial institution should be able to risk more than three percent of our nation’s gross domestic product and they should have enough money to back up their liabilities,” Brown continued. “This bill would not only prevent bailouts and protect against economic collapse, it will help boost lending to small businesses. We know that the dominance of a few megabanks has virtually frozen lending to small businesses, which account for 64 percent of new jobs.  Having more banks will create competition and increase small business lending so that our economy can grow and unemployed Americans can find jobs.”
 

The nation’s financial system has become dominated by institutions that are not only “too big to fail,” but also, as FDIC Chairman Bill Isaac describes, “too big to manage, and too big to regulate.”  The six largest U.S. banks now have total assets estimated to be in excess of 63 percent of our GDP.  The gigantic size of megabanks, and the perception in the marketplace that they are indeed too big for the government ever to permit them to fail, gives these megabanks a competitive advantage over smaller financial institutions. The lack of competition in the banking industry leads to ever-higher levels of risk in the system.”
 
The financial sector has received nearly $4.6 trillion in taxpayer support since the Wall Street meltdown in 2007-08. That figure represents at least four times what has been spent in the wars in Iraq and Afghanistan since 2001.
 
The SAFE Banking Act of 2010 would limit the size of megabanks by:

• Imposing a strict 10 percent cap on any bank-holding-company’s share of the United States’ total insured deposits;
• Reducing the maximum amount of non-deposit liabilities at financial institutions (to two percent of United States GDP for banks, and three percent of GDP for non-bank institutions);
• Setting into law a six-percent leverage limit for bank holding companies and selected nonbank financial institutions.

The SAFE Banking Act would also help boost lending to small businesses. The dominance of a few megabanks has helped to contribute to a virtual freeze of lending to small businesses, which create approximately 64 percent of new jobs. Over the last year, banks have been decreasing their consumer and small business lending, including Small Business Administration (SBA) loans. The three biggest banks reduced their 7(a)-SBA lending by 86 percent from 2008 to 2009), while increasing their investments in securities by almost 23 percent. Having more banks will create competition and increase small business lending so that our economy can grow.
 
Components of the SAFE Banking Act – particularly size caps – are supported by an ideologically-diverse group of economists. The idea of size caps is supported by Thomas Hoenig, President of the Kansas City Fed; Paul Volcker, former Chairman of the Federal Reserve; Mervyn King, Governor of the Bank of England; Richard Fisher, president of the Dallas Fed; Robert Reich, Secretary of Labor under former President Clinton; and commentator Arnold Kling of the National Review.
 
Brown and Kaufman held a news conference call today with The Main Street Alliance, a consortium of small businesses committed to Wall Street Reform. The Main Street Alliance released a letter <http://brown.senate.gov/imo/media/doc/MSA%20Letter.pdf>  signed by 117 small business owners from 23 states calling on Congress to enact comprehensive financial reform that contains 3 pillars: enacting an independent consumer financial protection agency, ending “too big to fail” banking , and ending proprietary trading.  The letter argues that without these three things, small businesses will continue to be at the mercy of risky Wall Street speculation that destroyed our economy, cost 8 million people their jobs, and forced untold numbers of small businesses into bankruptcy.  
David Borris of the Main Street Alliance said, “We have built our business on a 25 year old foundation of honesty, transparency, and a deep commitment to serving our local community.  Wall Street has broken our trust, and if we don’t take this opportunity to reign in the abusive and reckless practices we will only be sowing the seeds of another crisis.  We, America’s small businesses, who suffer the brunt of these crises, deserve more of our elected representatives.  Stand with us and pass comprehensive financial reform, including an independent consumer financial protection agency.”