Name the latest congressional banking scandal

Background: When it approved the Dodd-Frank Wall Street Reform and Consumer Protection Act in July 2010, Congress obliged the Consumer Financial Protection Bureau with combating “unfair, deceptive and abusive” practices by the banking industry. Most experts agree that the housing bubble was fueled by unfair practices such as the so-called liar loans (where unsuspecting borrowers were encouraged to lie about their financial credentials so that mortgage companies and banks could earn big fees on the deals and then simply pass the bad mortgages to someone else). When the bubble burst, the world entered the worst global economic recession since the Great Depression. So it seemed a little consumer financial protection might be the least reform Congress could muster.
 
But, as leaders such as Reps. Barney Frank (D-Mass.) and Brad Miller (D-N.C.) have sagely observed, it appears that “unfair, deceptive and abusive” practices may be essential to the modern American banking value proposition. The average length of a checking account contract: 111 pages. That’s according to a recent Pew Charitable Trusts study. Fine print is where muggers hide, and 111 pages is certainly a good deal of hiding ground. That kind of talk comes from a certain Ms. Elizabeth Warren.
 
She’s a plain spoken woman raised in Oklahoma, (and thus ruled by common sense — full disclosure: I’m from plain speaking Idaho myself) who happens to be an acclaimed Harvard Law School professor. She’s been adding quite a bit about to her already formidable knowledge of banking in the last few years since she was appointed to head the Congressional Oversight Panel. 

Congress charged the COP (a common sense acronym) with diagnosing the causes of the financial meltdown. That took more than a year, much running around interviewing experts along with the average banking consumer (as in victim), reading several thousand pages of reports, holding numerous public forums and more. Ms. Warren learned about the muggers hiding in the fine details of checking account contracts, and the liar loans and much more.  The efforts of the COP also built support for an important idea: a Consumer Financial Protection Bureau. And eventually, over the grumbles of conservative, pro-bank lawmakers, the CFPB became law.
 
But just because a law is passed doesn’t mean the lawmakers themselves (some of whom didn’t vote for it) are obliged to play along with it. (We must correct our high school civics textbooks.) The opposing lawmakers can try to overturn the law. That’s currently being tried in the House, where pro-bank conservatives have deconstructed parts of the reform law and are moving bills repealing those sections. Or lawmakers can threaten to block Ms. Warrens’ nomination, which is the Senate’s approach. Holding up a nominee should be a scandal, but it’s not.

Finally, lawmakers can simply resort to bullying. That’s political assault. And assault is a felony in any state;  a scandal. And it deserves a name, such as Watergate, or Teapot Dome.
 
Recall the Keating Five. That’s where five senators (Don Riegle , Alan Cranston, Dennis DeConcini, John McCain and John Glenn) joined to intimidate the regulators from doing their job and closing Lincoln Savings & Loan, the iconic rogue thrift from the S&L crisis in the 1980s. Those senators who are living remain mighty ashamed of themselves for that.

Then there’s the scandal called “13 Bankers,” when then-Treasury Secretary Lawrence Summers angrily called a banking regulator named Brooksley Born with 13 bankers in the room with him to threaten her off reforming the derivatives market. If Ms. Born had succeeded, she might have steered the ship of America clear of the crash we just suffered. MIT economist Simon Johnson coined the term “13 Bankers” for this scandal in his eponymous best-seller.
 
Now we need a name for this latest scandal. We could call it 44 Senators, the Senate 44, or maybe something using Cinco de Mayo, since the letter was sent on May 5th. We could work with “Sinko,” maybe. Or perhaps Snowe Job: Sen. Olympia Snowe joined fellow Maine Republican Susan Collins and voted for the Dodd-Frank Act.

Why are they changing now? Contributions (banks do count #1 as their richest source of donors)? Party loyalty? Modern scandals often end in “gate,” after the Watergate scandal. Senategate? GOPGate? GOPSolongate? DoddFrankGate?
 
Lest we think this scandal doesn’t match the gravity of a Watergate or Teapot Dome, recall that bad banking law led to the crash and global economic depravity, a situation arguably far worse than a break-in of a political party office. Those 44 senators perpetuate the legacy of bank-bought legislation that caused our mess, and promises to stifle efforts to prevent another calamity.
 
As with all blogs in The Hill, there’s a comment section below my entry today. So please, help name the scandal! America needs short-hand for this depraved Washington dynamic.
 
Bartlett Naylor is financial policy advocate for Public Citizen’s Congress Watch.