Euphemism and Duplicity at Congress Rescues the S&Ls

Euphemisms usually go with duplicity and the House Banking Committee deliberations on the giant Savings and Loan bailout provoked this combination repeatedly.

Each time a Committee member proposed a modest consumer protection measure to slightly balance off the placing of this $300 billion thirty year bailout on the banks of consumers, a minion of the banking industry would declare the need to “keep this a clean bill.” Rep. Joe Kennedy, who wanted some disclosure requirements on Savings and Loan banks regarding red-lining, took umbrage at this description. He asked the minion why he would think a consumer protection proposal would make the bill “dirty.”

Consider the epidemic scope of this Congressional sell-out (S&L campaign finance money is all over Capitol Hill) for requiring that these bank scandals be paid by small taxpayers and small depositors at a level of $1000 to $2000 per person over time. Making Americans who had nothing to do with these scandals and did not benefit from them pay for these business crimes is okay for the likes of Chalmers P. Wylie (R-OH), the ranking Republican member of the Committee, and for Doug Barnard, Jr., (D-GA). But heaven forbid giving consumers some rights vis-à-vis these S&Ls that. will make home mortgage funds more available on a non-discriminatory basis.

Rep. Barnard, a former banker, disregarded his home state’s largest newspaper, the Atlanta Constitution, which published a prize-winning series of banks red-lining minority neighborhoods in Atlanta. He then proceeded to vote against every consumer amendment before the Committee.

At one point, Rep. Wylie praised the Senate-passed version of the bailout bill for not cluttering it with consumer provisions. He said that legislation before this Committee was a “safety and soundness” measure. Another euphemism. For whom? For the S&L industry that pushed for de-regulation in the early Eighties, thus taking the federal cop off the banking beat. Not for millions of Americans, who are beginning to find out what their lawmakers are doing to their pocketbooks via this huge Congressional White House scam.

Were the Committee’s debate about the bailout bill on live television, a citizen’s revolt might have occurred right then and there. The venality hung thick over the large hearing room and the imperiously smug lobbyists for the S&L industry filled the seats. Some had portable phones to call their executives about how smoothly each vote was going for them. Their minions read their industry-prepared statements dutifully at the prescribed time and the bank bloc of votes struck down almost every appeal to give something to the consumers in return for sending them the bailout bill.

One proposal to combat the notorious discrimination against minority groups by too many S&Ls was even opposed by Rep. Patricia Saiki (R-HI) -­an Asian-American who should know the history of discrimination. Her pro-bank votes were complete and registered as if she were on automatic.

The backroom drama and the stench of what is going on these days as the legislation moves to the House floor in a few weeks, prodded by Bush’s lobbyists who want to get it over with before the public arouses itself, is receiving too little national television and press.

But the tide of protest is rising. Quite indignant people calling Public Citizen’s S&L bailout hotline (202) 546-4996 for a free information action kit are asking the same question: “Why should we have to pay for the crooks and the mess they created?” The answer is: “You shouldn’t. Corporate taxpayers should pay for corporate scandals. This way, they’ll be more cautious next time about policing their ranks.”