House financial services committee chair Jeb Hensarling (R-Tex.).
Last week, Sen. Elizabeth Warren (D-Mass.) warned that, five years after the financial crisis, the biggest Wall Street banks are still so large and loosely regulated that their failure would endanger the entire financial system, forcing the government to bail them out. This problem—called too-big-to-fail—is worse now than it was in 2007, Warren said, because the four largest banks are 30 percent bigger than they were before the financial crisis. House Republicans have made common cause with Warren on the issue—at least rhetorically. But when it comes to proposing a solution, GOPers in the House are MIA; in fact, they've pushed bills that would preserve bank bailouts.
Since Republicans took over the House in 2010, the House financial services committee hasheldsixhearingsonhow the 2010 Dodd-Frank financial reform act may not have ended too-big-to-fail.
In March, Rep. Jeb Hensarling (R-Texas), the chairman of the committee, told the Wall Street Journal that he would doggedly work to prevent more big bank bailouts. The article was titled "Texan's Plans Put Wall Street on Edge."
But Hensarling and his fellow Republicans have yet to propose a fix. "They've been in power for three years now," says one Democratic aide. "What have they done?"
Financial reformers agree with Warren and Hensarling that Dodd-Frank has not ended too-big-to-fail. One reason is that big banks operate internationally, which limits the government's capacity to wind down failing institutions. Another is that the rules that regulators have drawn up to implement the Dodd-Frank law are too weak, reformers say. The financial reform law says that banks have to hold onto a sufficient amount of emergency reserves to protect themselves in case of another downturn, but advocates charge that bank regulators have proposed reserve levels that are too low to save banks in case the economy tanks again.
Congress is getting ready to pass a farm bill—the $500 billion piece of legislation that funds agriculture and nutrition programs—that will cut funding for food stamps. As Mother Jones reported last week, Democrats in the House are considering banding together to derail the bill entirely, thus preserving nutrition funding at its current level. Support for that idea is building.
The House and Senate are currently negotiating a compromise farm bill that will contain food stamps cuts somewhere between the $4 billion the Senate wants and the $40 billion the House wants. (These cuts will come on top of the $5 billion in funding reductions to food stamps that went into effect at the beginning of the month as extra stimulus money for the program expired.) On Thursday, Reps. Alcee Hastings (D-Florida) and Eddie Bernice Johnson (D-Tex.), co-chairs of the Congressional Homelessness Caucus—a group of House lawmakers devoted to policies that help the extremely poor—signaled that they are drumming up support for no votes on any compromise bill. The two lawmakers asked members of the caucus to sign a letter to the House and Senate agriculture committees opposing any cuts to the food stamp program, called the Supplemental Nutrition Assistance Program (SNAP).
"For those living without permanent housing, everyday life is extremely difficult," the lawmakers say in the letter. "SNAP benefits provide these individuals with a limited opportunity to obtain nourishment."
House Democrats wager that if enough House Republicans vote against a final farm bill because they think the food stamps cuts are not deep enough, only a small group of Dems will need to also vote against the bill in order to kill it. In this case, food stamps would continue to be funded at current levels.
There is precedent for this idea: the last food stamps battle. In June, the House failed to pass a farm bill that cut $20 billion from SNAP because 62 conservative Republicans thought that wasn't enough and 172 Democrats thought the reductions were far too deep. This time around, food stamps funding will probably be cut by around $10 billion in the farm bill, according to a Democratic aide. That means far more GOPers will vote against the bill. The more Republicans that House Speaker John Boehner loses, the more Dems he'll need to pass the farm bill. If Democrats don't play ball, they'll win—which could keep thousands of Americans from destitution. "For many families with limited resources living close to or at the poverty level," Hastings and Johnson write in the letter, "cuts to food benefits [would] force them to choose between food and rent."
Last week, President Barack Obama announced a fix for the millions of Americans who have received health insurance cancellation notices. Insurers will now have another year to offer plans that don't comply with the Affordable Care Act. But insurance companies probably won't go along with the president's plan.
Seven major health insurers—including United Health Group, Humana, and Kaiser Permanente—tell Mother Jones they're not sure what they'll do yet, and are waiting for direction from state insurance commissioners, many of whom have yet to decide whether they'll back Obama's idea. But health care experts say it's likely that many insurance companies will not adopt Obama's fix, because doing so would be an administrative hassle and create uncertainty, costing insurers money.
The background: Under the military justice system, if a service member is assaulted, the commander of the alleged perpetrator has the final say over whether charges should be brought.* Commanding officers are also allowed to overturn sexual assault convictions. Top military brass say that commanders need this kind of prosecutorial discretion to maintain order and discipline within the ranks.
Two members of the Senate armed services committee—Kirsten Gillibrand (D-N.Y.) and Claire McCaskill (D-Mo.)—disagree, and have put forward plans to reform the system. But they're at odds over how to fix it. Gillibrand heads up a coalition that believes military commanders should no longer have control over sexual assault cases, because current policy deters reporting of sex crimes and lets predators off the hook. McCaskill and her supporters in the Senate say Gillibrand's solution could actually increase retaliation against victims who report assaults, and could prevent some victims from bringing charges against attackers.
On Monday afternoon, Sen. Elizabeth Warren (D-Mass.) delivered a speech on the Senate floor slamming those on Capitol Hill who want to cut Social Security in order to balance the budget and calling on Congress to expand the program instead.
"This is about our values," the senator said, "and our values tell us that we don't build a future by first deciding who among our most vulnerable will be left to starve."
Lawmakers have to come to an agreement to fund the government by mid-January, and some are floating Social Security cuts as a bargaining chip in a possible budget deal. Even President Barack Obama's last budget proposal contained cuts to the program.
Warren says slashing retirement benefits for elderly Americans is an absurd idea. Warren noted that Social Security payments are already stingy, averaging about $1,250 a month. Plus, an increasing number of Americans can no longer count on healthy pensions through their job. Two decades ago, 35 percent of jobs in the private sector offered workers a traditional pension that provided monthly payments retirees could rely on. Today, that number is only 18 percent. Some 44 million workers get no retirement help from their employers.
Because of the growing "retirement crisis" in America, Warren argued, "we should be talking about expanding Social Security benefits—not cutting them." She noted that several senators, including Tom Harkin (D-Iowa) and Bernie Sanders (I-Vt.), have been pushing for just that.
Seniors are not going to get more generous retirement benefits as long as the GOP-dominated House opposes the idea. But most Democrats have said they won't agree to entitlement cuts without new revenues, and Republicans refuse to raise revenues, so real cuts are unlikely, too. Rather than hashing out a grand bargain that includes cuts to the safety net, Congress will probably kick the can down the road, and come to another modest, last-minute, short-term budget accord early next year.
But Warren's speech was about more than staving off immediate cuts to retirement benefits. It was yet another move to cement her role as Congress' star defender of the middle class. Warren has said she will not run for president in 2016. But this is one of many issues on which she has staked out a position to the left of former Secretary of State Hillary Clinton, who is widely expected to run. In a speech at Colgate University last month, Clinton did not rule out the idea of limited cuts to entitlement programs as a means to reaching a budget deal.