Jeff Hauser and Kurt Walters
The Hill, March 25, 2018
“Trump in power constitutes a crisis for America, and the opposition must be unified!” That’s been the cry from the Democratic party establishment since the presidential election of 2016.
As calls for unity go, this one is unusually justifiable, imperative, in fact. But the Democratic establishment broke faith with its own credo in the past few weeks, even as the benefits of a unified effort against Trump and the Republicans became clear in the congressional election that delivered a victory to Conor Lamb in Pennsylvania.
After a year of in which they were the shock troops of the resistance to Trump, Senate Minority Leader Chuck Schumer (D-N.Y.) turned on progressives when he turned a blind eye as 17 Democrats voted for a banking deregulation bill.
Now the onus is on the House leadership — Rep. Nancy Pelosi (D-Calif.) and Steny Hoyer (D-Md.) — to fight harder than Schumer did or risk demoralizing progressives in advance of perhaps the most consequential midterm elections since the New Deal.
The progressive wing of the Democratic Party has done its part since Trump took office. Establishment figures like Gov. Ralph Northam (D-Va.) received strong support from progressives when they won primaries over progressives like Tom Perriello.
Democrats stood united to block Republicans’ efforts to repeal the Affordable Care Act before settling questions about the need for single-payer health care. Members of important progressive organizations bankrolled candidates ranging from progressive Rob Quist to buttoned-down moderate Jon Ossoff.
In turn, Democrats have seen historic turnout in special elections across the country. As the party shaded more toward economic populism and as Trump and Republican electoral prospects have declined, the bargain between populists and the establishment seemed to work both ways — until last week.
Seventeen members of the Senate Democratic Caucus voted with Republicans to move forward a bill that progressives nicknamed the Bank Lobbyist Act (S. 2155), which would roll back parts of President Obama’s legacy-defining Dodd-Frank Wall Street Reform and Consumer Protection Act.
The bill, put simply, stinks. It would exempt 25 of the largest 38 banks in the country from strong oversight, banks that took $47 billion in bailouts after the 2008 financial crash. The Congressional Budget Office found this bill would make taxpayer-backed bank bailouts more likely. And it would deliver new favors to Wall Street giants Citigroup and JPMorgan Chase.
The biggest insult may be to communities of color, which were the electoral muscle behind the stunning win of Sen. Doug Jones (D-Ala.). The bill would allow 85 percent of banks to avoid full disclosure of data on mortgages, at a moment when this data shows that African-Americans and Latinos still get a worse deal than white borrowers.
But it is the political short-sightedness that defines this giveaway. Schumer has pushed for Democrats to reclaim the mantle of economic populism from Trump’s phony "everyman" appeals.
Schumer launched the Better Deal agenda last summer laying out the party’s new priorities. He summed up his approach as, “[Trump] is helping the wealthy and corporations; we are fighting for the middle class. That is the sentence.”
Needless to say, a third of Senate Democrats siding with Trump to deregulate big banks damages the credibility of this message. And let’s not kid ourselves about what’s going on: They’re voting for the bill, raising money from the industry and hoping no one notices.
Schumer himself bears a great deal of responsibility, and progressives rightly suspect him of actually wanting the bill to pass. He voted against it but didn’t fight against it either. Sen. Elizabeth Warren (D-Mass.), a member of Schumer’s leadership team, no less, came under withering attack from fellow Democrats for having the audacity to inform the American public which members of the Senate voted for S. 2155.
If some Democrats truly believe it is worse to sound the alarm about a big bank giveaway than to vote for a big bank giveaway — just 10 years after they melted down the economy — it’s hard to dispute the continuing power within the Democratic Party of a disconnected elite.
Now the bill goes to the House. Pelosi and Hoyer have a chance to unify their caucus against this gift to bankers. If the bill returns to the Senate, Schumer needs to fight, not stand idly by.
It’s about time leaders in the Democratic establishment keep their end of the bargain that has brought unprecedented Democratic unity in many respects. Progressives don’t want a two-front war against pro-corporate policies in both parties.
But the morphing of Democrats away from their populist roots got us Trump. Pleasing Wall Street has no place in a vibrant Democratic party.
Jeff Hauser runs the Revolving Door Project, an effort to increase scrutiny on executive branch appointments and ensure that political appointees are focused on serving the public interest, rather than personal professional advancement.
Kurt Walters is a campaign director at Demand Progress, which works to win progressive policy changes through organizing and grassroots lobbying. Demand Progress focuses on issues of civil liberties, civil rights and government reform.