"President Trump named John R. Bolton, a hard-line former American ambassador to the United Nations, as his third national security adviser on Thursday, continuing a shake-up that creates one of the most hawkish national security teams of any White House in recent history. Mr. Bolton will replace Lt. Gen. H. R. McMaster, the battle-tested Army officer who was tapped last year to stabilize a turbulent foreign policy operation but who never developed a comfortable relationship with the president." Bolton was an outspoken advocate of military action during the George W. Bush administration, and has "called for action against Iran and North Korea."
When Sherrod Brown said on the Senate floor this week, “This bill puts Americans at risk of another bank bailout,” it was a callback to a different era. In the aftermath of the worst economic crisis since the Great Depression, the vast majority of Democrats in the House and Senate passed the Dodd-Frank bill in 2010 to greatly expand the government’s power over Wall Street and the banking sector. At its signing, President Obama claimed “there will be no more taxpayer-funded bailouts. Period.”
Yet next week, the Senate is expected to pass its most consequential rollback of Dodd-Frank, with the support of a significant number of Democrats, even though the Congressional Budget Office claims it would slightly increase the odds of another financial crisis.
The political winds have changed.
Many of the Democrats who support the bill are senators from red states up for reelection who have been clamoring to cut red tape for community- and regional-bank relief for years, like Jon Tester of Montana, Heidi Heitkamp of North Dakota, and Joe Donnelly of Indiana. In their races, supporting the bill—perhaps the most significant bipartisan one to come during the Trump era—is an opportunity to tout their ability to work with Republicans.
Brown is an outlier in that group. Representing Ohio—a state that Donald Trump won by nearly 450,000 votes, or 8 points, in 2016—the top Democrat on the Banking committee is one of the few in his party from such a state to rage against the legislation, which he’s done from the floor of the Senate chamber to BuzzFeed’s AM to DM show on Twitter, drawing the praise of progressive groups from the AFL-CIO to Indivisible, a grassroots organization set up after Trump’s election. Sen. Elizabeth Warren of Massachusetts, the liberal firebrand, commended Brown this week “for leading the fight.”
Ethan Goodman, of Indivisible’s Cleveland chapter, said they’ll be phone banking for Brown this weekend. “We’re proud that Senator Brown is fighting to make sure Ohio isn’t taken advantage of,” he said. “There’s a lot of housing insecurity here. If this bill goes through, we’re going to go through 2008 all over again. We haven’t even really recovered yet.”
Republicans running against Brown are eyeing an opening. Rep. Jim Renacci, a multi-millionaire businessman who started and sold a number of nursing homes and owned shares in the Columbus Destroyers, a former Arena League football team, and Harley-Davidson dealerships, said community banks “gave me the opportunity to get started.”
“So, I’ve always been a big believer in small banks, the community banks,” said Renacci in an interview. “And in some ways I don’t think that Sen. Brown understands that.”
There are a number of reasons why moderate Democrats have joined Republicans in supporting the bill. The measure would mandate that federal regulators change the rules which govern whether banks holding under $10 billion in assets are considered well-capitalized, making it easier for smaller banks to be exempt from certain Dodd-Frank rules. Unlike the House version passed last year, the Senate effort doesn’t cleave off major authorities of the Consumer Financial Protection Bureau, a prime target of conservatives.
While it allows red-state Democrats to say they worked across the aisle with a Republican Congress and president, it’s unclear whether it matters politically at all in a state like Ohio.
“The base I think is motivated by a lot more fundamental issues, starting with the President of the United States,” said Dick Durbin, the Senate minority whip. “I don’t think bank regulation in and of itself is going to be a decisive issue in [any] Democrat reelection.”
A Democratic pollster with extensive experience in the Ohio political campaigns said, “This kind of debate for the most part washes over, but if you really … drew lines between big banks and consumers, they know that they’re consumers and they know that very few of them own banks.” But the pollster acknowledged that swing voters are not paying attention to the details of the bill “That’s what makes them swing voters is they’re less interested in all this,” said the pollster.
That’s not to say the Senate bill doesn’t matter.
The most high-profile portion of the bill would raise the threshold for banks to be considered a systemically important financial institution, or “too big to fail.” The bill would raise the bar from $50 billion in assets to $250 billion, effectively lifting the toughest Dodd-Frank regulations such as regular stress tests from hundreds of small and regional banks.
There are a number of regional banks in Ohio, which have been pushing for regulatory relief, that would benefit from the legislation. Cincinnati-based Fifth Third Bancorp, which reported $142 billion in assets in 2017, would fall under that asset-rule change. Fifth Third reported $1.29 million in lobbying expenditures in 2017, an increase from the $720,000 the year prior, according to data from the Center for Responsive Politics. Among the issues lobbied were the systemic risk rules and the House version of the Dodd-Frank bill.
Other mid-size, regional banks in Ohio include Cleveland-based KeyBank, which reported $132 billion in assets in 2017 and Columbus-based Huntington Bancshares Inc., which reported $102 billion in assets the same year. Renacci said he’d like to provide “flexibility” to more banks that are “just a little bit higher” than the proposed threshold to help banks like PNC, which claimed to hold $282 billion of assets under administration in 2017.
Brown and other critics of the bill like Warren say that small and regional banks took bailouts during the financial crisis as well, and easing rules on them puts the system at risk from a cluster of bank failures in the event of another crisis.
Brown said on the Senate floor Wednesday that while he supports some aid for community and mid-size banks such as the ones in his home state, the Senate bill has morphed into something benefitting Wall Street.
“When the big banks spot some legislation crawling through this body, when they see a bill in front of the Senate or the House that might help some small institutions, you know what they do?,” Brown asked. “They see an opportunity to grab more for themselves.”
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"The EU has recalled its ambassador to Moscow after leaders agreed it was 'highly likely' Russia was responsible for a nerve agent attack in the UK. The European Council of EU leaders said there was 'no plausible alternative.' Moscow denies responsibility for the attack on an ex-spy and his daughter and said the EU was following an 'anti-Russian campaign launched by London.'"