Labor urges tougher regs for Wall St.

AFL-CIO President Richard Trumka said Tuesday he would not accept a
weaker independent agency designed to rein in Wall Street banks in
order to win Republican votes.

The labor movement has been one of the biggest advocates for a consumer financial protection agency as part of a Wall Street reform package under consideration by Congress. Trumka said his goal is seeing a bill passed that is strong enough to prevent another economic collapse similar to the Wall Street crash of September 2008.

{mosads}“Any unnecessary compromises or any diluting compromises that will take that bill beyond what is necessary to prevent the crisis from happening again, we will obviously oppose and oppose vigorously,” Trumka told reporters.

The union leader said the consumer agency needs to be free of a council of regulators overseeing it, including at the Federal Reserve, as well as hold its own authority to write federal regulations to protect consumers from financial products.

The House version of the legislation includes a standalone agency, while the Senate version contains a bureau that would be housed at the Federal Reserve. The differences still have to be worked out between the two chambers.

“We want to make sure the consumer financial protection agency is independent,” Trumka said, “that it has the rulemaking ability to stop Wall Street from the shamming that cost investors a lot of money and that [it] is also insulated in a way that prevents any agency from overseeing or overturning the rulings of the federal agency.”

The consumer agency has been one of the biggest flash points during the Wall Street reform debate, drawing heavy fire from Republicans and being lobbied against by financial firms and business associations.

It has drawn support from Democrats, though, who see good politics in the legislation and hope anti-Wall Street fervor will override any opposition and secure passage of the bill. However, they will still need some Republican support to move the consumer agency past a Senate filibuster. Trumka, the leader of a key Democratic constituency, said he was not in favor of any compromise version.

Trumka laid out his demands for the financial regulatory reform bill as the AFL-CIO launched its Executive PayWatch database for 2010 on Tuesday.

The database details $145 billion spent by financial firms in total 2009 executive compensation. It also presents six case studies of executive pay and lobbying efforts against the reform bill for America’s largest banks: Bank of America, Wells Fargo, JP Morgan Chase, Goldman Sachs, Morgan Stanley and Citigroup.

The release of the database is all part of a months-long union-federation campaign to have Congress pass Wall Street reforms. An affiliate organization of the AFL-CIO, Working America, has generated 10,000 letters to members of Congress calling for a consumer financial protection agency, as well as about 140,000 faxes to the banks themselves, according to Karen Nussbaum, the group’s executive director.

Further, protests are planned this month at a number of the banks’ headquarters and shareholder meetings across the country. The protests are expected to culminate in an attention-grabbing rally on Wall Street by the end of April. Trumka estimates there will be 10,000 protesters or more at the event in Manhattan.

“Our message to the banking CEOs is that hardworking Americans will not be your ATM anymore,” Trumka said. “Congress needs to act now.”