Right blames NC consumer advocacy group for 'Wall Street corruption'
Yesterday, about 20 members of the conservative group Americans for Prosperity -- with nearly as many members of the media in tow -- gathered in downtown Durham, North Carolina to protest "Wall Street corruption" and the financial reform bill now moving through Congress.
Why Durham? Because it's home to the Center for Responsible Lending, a consumer advocacy group that has pushed for tougher banking rules.
The Center is also the former employer of Eric Stein, a leading voice for financial reform who now works in President Obama's Treasury Department.
You may be wondering: How do you link the Center and Stein, staunch proponents of Wall Street reform, to "Wall Street corruption?" By painting the advocates as the ones who are too cozy with bankers and financial interests.
Taking a cue from a now-famous memo by Republican strategist Frank Luntz [pdf] -- which argued back in January that, because financial reform is popular, "the single best way to kill [financial reform] legislation is to link it to the Big Bank Bailout" -- the protesters called the Congressional bill "permanent bailout legislation."
(As the fact-checking group Politifact points out, the bill doesn't include bailouts: It creates a trust, funded by taxes on large financial institutions, that would fund the closing of failed banks.)
In particular, Americans for Prosperity zeroed in on $15 million given to the Center by John Paulson, a hedge fund manager implicated in the current investigation into Goldman Sachs. The demonstrators said this "dirty money" was reason enough to demand Stein's removal ("Stein must resign!") and to halt the federal reform bill until Congress investigated Stein, the Center and Paulson.
Facing South asked some of the Americans for Prosperity protesters why they were protesting at the Center for Responsible Lending, and received a wide range of responses, ranging from "Wall Street corruption" to concern about the $15 million deal and dislike for ACORN (which isn't connected to the Center):
The demonstrators Facing South interviewed were unclear about the nature of the Center's connection to Paulson. Of the $15 million Paulson gave to the Center, one man demanded to know "where the money went;" another assumed it went to Center "salaries and things like that." At one point, the protesters chanted "give the money back!"
A Center spokesman says it's hardly a mystery: The $15 million helped launch the Institute for Foreclosure Legal Assistance, which trains local legal aid centers to help families facing foreclosure. The Institute isn't even run by the Center for Responsible Lending; it's managed by the National Association of Consumer Advocates.
Big banks certainly don't see the Center and Stein as helpful allies. Wall Street has dispatched over 1,500 lobbyists to Washington to defeat the financial reform bill the advocates support. Payday lenders, which the Center has targeted for charging up to 400% interest, spent over $2.6 million in lobbying last year to ensure they're not regulated under the bill, up 75% from the year before.
In fact, John Paulson and Wall Street interests are understandably much closer to Americans for Prosperity and other opponents of reform. According to the Center for Responsive Politics, nearly 60% of Paulson's campaign contributions have gone to Republicans, who are opposing the reform legislation.
Americans for Prosperity itself has direct links to banking interests. James C. Miller III, who is listed as one of Americans for Prosperity's directors, served as the executive director of then-Vice President George H.W. Bush's Presidential Task Force on Regulatory Relief. He also served on the board of the J.P. Morgan Value Opportunities Fund and as a consultant to Freddie Mac. James E. Stephenson, another AfP director, serves on the board of the Republic Bank of Georgia.
For conservative websites like BigGovernment.com, which has helped publicize the Center/Stein/Paulson allegations, the attack almost seems personal. One of BigGovernment's editors is Mike Flynn, former leader of the Consumer Rights League -- a front group supported by payday lenders to oppose reform which shares an office with the tea party-connected group FreedomWorks.
Meanwhile, a Senate vote on the financial reform bill is expected within days, and as the Los Angeles Times reports, "Wall Street is battling aggressively against the legislation."
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