Pendulum Swings Left in the Democratic Debate
Robert Weissman of Public Citizen says Sanders shifted much of the debate focus to inequality, corporate greed, power of the pharmaceutical industry, and reining in excesses of capitalism
SHARMINI PERIES, EXEC. PRODUCER, TRNN: Welcome to the Real News Network. I’m Sharmini Peries coming to you from Baltimore.
Democratic party debate on Tuesday night is the topic of our next discussion. Joining me for that from Washington, DC is Robert Weissman. Robert is the president of Public Citizen and a staunch public interest advocate and activist as well as an expert on corporate and government accountability. Robert, thank you for joining me.
ROBERT WEISSMAN: It’s great to be with you.
PERIES: Robert, let me get your first take on the debate last night.
WEISSMAN: I think one of the interesting things about the debate was the extent to which the whole conversation has been pulled to the left. I think that’s in large part due to the Sanders campaign, but also because of what the party base is demanding. It of course is traditional for the Democratic candidates to be pulled a little bit to the left in the course of the primaries. But I think this is different. I mean, if you sort of bracket foreign policy as kind of its own little thing, a lot of the debate was really focused around inequality and not just sort of the normal stuff about raising middle class living standards, but a real debate around corporate power, Wall Street, power of the pharmaceutical industry. And meaningful measures to reduce income inequality.
And as well as, you know, on the issue of guns, where Hillary was trying to out-left Sanders on the issue where she’s able to do that. So it was quite notable, the degree to which the progressive agenda is really becoming the mainstream agenda of the Democratic party.
PERIES: It’s clear that Sanders is pulling the entire debate to the left. I thought one of the most interesting parts and perhaps one of the most unpredictable parts of the debate last night was when he was charged as being a socialist. That’s Bernie Sanders. And Clinton then had to debate him and had to actually talk about capitalism. And she said, sometimes we have to save capitalism from itself. Let’s have a look.
SPEAKER: You don’t consider yourself a capitalist, though.
BERNIE SANDERS: Do I consider myself part of the casino capitalist process by which so few have so much and so many have so little? By which Wall Street’s greed and recklessness wrecked this economy? No, I don’t. I believe in a society where all people do well, not just a handful of billionaires.
HILLARY CLINTON: When I think about capitalism I think about all the small businesses that were started because we have the opportunity and the freedom in our country for people to do that and to make a good living for themselves and their families. And I don’t think we should confuse what we have to do every so often in America, which is save capitalism from itself. And I think what Sen. Sanders is saying certainly makes sense in the terms of the inequality that we have. But we are not Denmark. I love Denmark. We’re the United States of America, and it’s our job to rein in the excesses of capitalism so that it doesn’t run amok and doesn’t cause the kind of inequities that we’re seeing in our economic system. But we would be making a grave mistake to turn our backs on what built the greatest middle class in the history of the world.
SPEAKER: Sen. Sanders?
SANDERS: I think everybody is in agreement that we are a great, entrepreneurial nation. We have got to encourage that. Of course we have to support small and medium-sized businesses. But you can have all of the growth that you want and it doesn’t mean anything if all of the new income and wealth is going to the top 1 percent. So what we need to do is support small and medium-sized businesses, the backbone of our economy. But we have to make sure that every family in this country gets a fair shake.
PERIES: So Robert, what did you think of that exchange?
WEISSMAN: Well, it was interesting to see Hillary Clinton defending the capitalist cause but saying she’s only doing it in the context of recognizing the inherent instability, the excesses of Wall Street, and the need to have sort of built-in restraints around what Wall Street and giant corporations do. It’s not really dissimilar to what Sanders might have said, except that he embraces the democratic socialist label.
PERIES: And in terms of some of the solutions required to rein in Wall Street, what do you think the candidates’ positions were, and do you think it will stick once they’re in office?
WEISSMAN: Well, it’s no surprise that Sanders has an aggressive record and position on dealing with Wall Street excess. And he’s long really championed the idea of breaking up the banks as fundamental to how we deal with Wall Street, that you just can’t have these giant institutions both because of the risk they pose to the entire financial system, the impossibility of avoiding bailouts when they’re so large, and also because they’ve just got too much political power. So I think he’s got a consistent record and that’s really the centerpiece of his Wall Street agenda.
Clinton has put out a pretty decent agenda, including some language that suggests going, intending to criminally prosecute Wall Street wrongdoers. Not just the companies but the executives, which would be very important if she were president and actually followed up. But she doesn’t have a position in favor of breaking up the banks. And you saw that division come out. O’Malley was really the one who tried to underscore that distinction. The debate kind of devolved into a weird thing where she said she was going after giant financial institutions that aren’t banks, which is a little bit, kind of a separate issue, really than what O’Malley and Sanders were talking about. And a little bit of her effort to muddy it up. When she said her platform was tougher on Wall Street than Sanders’, I think he rightfully met that with a chuckle.
But it’s not the case that hers is weak. And it’s much more aggressive than we might have expected from Hillary Clinton six or nine months ago.
PERIES: Robert, from the Public Citizen’s point of view, Sanders’ position on reining in Wall Street. Do you think it is a stronger position than that of Clinton?
WEISSMAN: I think that Sanders’ position is plainly tougher than the Clinton position. There’s again, as I said, there’s quite a bit of good stuff in the Clinton platform. But if there is one single most important thing to do to try to rein in Wall Street power it is to break up the giant financial institutions, for the reasons that I mentioned before. They are too big to manage. The government can’t control banks and financial institutions of this size. They’re afraid to criminally prosecute them if they are on the verge of failing, as was in the case in 2008. There are real concerns about whether the whole global economy collapses as a result. So when they’re this big it’s almost impossible not to bail them out. So you have to proactively in the first place break them up so they’re not so large.
And then as important as any of those issues is just the political power, the concentrated political power, that comes from the concentrated financial power that’s embedded in these giant banks and other financial institutions. And that itself is a reason why they have to be broken up, and why it’s so important that Sanders, O’Malley, and others are carrying that forward.
There are a bunch of other things that have been part of the debates. Sanders is calling for and emphasized his proposal for financial speculation tax, a tax on Wall Street trades. That would [meaningfully] curtail Wall Street abuses, would slow the churn on Wall Street. Reduce some stock turnover and raise huge amounts of money. That’s an important piece of it. Clinton is focused on trying to close the revolving door between Wall Street firms and regulators. That’s very important. They’re both talking about, as well as the other candidates, the Consumer Financial Protection Bureau, and the best elements of the Dodd-Frank law. That’s important.
So there’s a lot we have to do. And there’s good stuff in all these plans. But again, if there’s one most important thing it’s dealing with these structural and systemic problems. And the way to do that is by breaking up these giant institutions which are incompatible with democracy and incompatible with a stable financial and economic system.
PERIES: Now, we’ve had almost seven years of a Democratic rule here with, after a financial collapse on Wall Street and trying to rein that in. And yet we have now very, very weak Dodd-Frank regulations. And they haven’t really done much in the past seven years. Why would anyone think otherwise moving forward?
WEISSMAN: Well, I think–I wouldn’t say Dodd-Frank is meaningless. It’s done some important things. Most significantly with the creation of the Consumer Financial Protection Bureau, which has already saved consumers $10 billion or more, is on track for even bigger wins for consumers. I think the regulatory standards for Wall Street institutions are tougher in a variety of ways, and there is some curtailment of the banks’ involvement in the worst forms of speculation. So it’s not that it’s been nothing. It’s been way too slow in part because of the banks’ resistance, and in part because the regulators aren’t tough enough.
So even with the existing Dodd-Frank rubric, if you had someone come in who was committed to being tough on the big banks, you could do some things that were important. But of course we did have to do more. And you’re right, we had our best opportunity to do the most aggressive things in response to the crisis. And what we got was Dodd-Frank, which includes some important things but doesn’t go nearly far enough, and is weak particularly in this issue of dealing with the size of the biggest banks. As Sanders said last night, those banks that survived the crash in 2008 are actually bigger now than they were before. So Dodd-Frank plainly failed to deal with that problem. And the checks it has in place to deal with the possibility of future bailouts are really inadequate.
So how do you, how do you push through new, tougher legislation? There’s no easy answer to that, but I think the Sanders story is the right one. It can’t just be business as usual, but business as usual, well, we know how the Congress works and who the members of Congress feel they owe their allegiance to. There has to be a real mobilization of people. And if that’s the case then we can win some important things.
It wasn’t like the banks willingly accepted Dodd-Frank. That had to be imposed on them. And it was imposed on them in part because of organized efforts on the outside and in part because even in the absence of a really effectively organized population people were so outraged that legislators had to do something. So if we can capture that anger again but this time channel it more effectively, you know, it’s possible to do big things. But you need a leader who is committed to doing that, who is willing to engage and inspire that kind of popular mobilization.
PERIES: Robert Weissman with Public Citizen, thank you so much for joining us today.
WEISSMAN: Great to be with you.
PERIES: And thank you for joining us on the Real News Network.
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