John McCain's Friend Phil Gramm

With the drama of the Obama/Clinton race finally over we can focus on the sharp contrasting platforms and personalities of Barack Obama and John McCain.

An old cliché is that we can judge people by the company they keep. McCain’s camp has vigorously tried to scare people about Obama’s associations. Well, if you’re a hard working wage earner consider John McCain’s friend Phil Gramm. In 1996, John McCain endorsed former Texas Senator Phil Gramm’s quest for the presidency. As a Senator, Gramm was the Chairman of the Senate Banking Committee and worked hard to promote the interests of banks and credit card companies at the expense of wage earners and small business entrepreneurs.

Gramm is currently one of five campaign co-chairs for John McCain. One can surmise that Gramm, who fancies himself an expert on economics, will have a major influence and perhaps a senior position in a McCain administration. Gramm was also an advocate of undermining the 1977 Community Reinvestment Act (CRA) that mandated depository banks to contribute housing and small business loans in poorer communities to help people join the middle class. During the 1990s, the CRA under President Bill Clinton was actually enforced and helped raise the standard of living of people who needed it most.

Instead, John McCain's friend preferred to deregulate the financial services industry and promote predatory lending practices that enriched the wealthy at the expense of working people. Gramm is a classic practitioner of class warfare waged from the top. Furthermore, elitists have even scapegoated the CRA about the current mortgage housing crisis and look upon Phil Gramm as their ally on the inside. To learn more about the CRA and how it is being scapegoated, listen to my recent podcast interview with economist Jared Bernstein by clicking here.

Today, Phil Gramm is the vice chairman of a U.S. division of Zurich-based financial powerhouse UBS and as Newsweek reports:

“UBS has recently written off huge losses in subprime-mortgage-based securities, and last week liberal bloggers noted that Gramm was a registered UBS lobbyist on mortgage-securities issues until at least December 2007.

NEWSWEEK has learned that UBS is also currently the focus of congressional and Justice Department investigations into schemes that allegedly enabled wealthy Americans to evade income taxes by stashing their money in overseas havens, according to several law-enforcement and banking officials in both the United States and Europe, who all asked for anonymity when discussing ongoing investigations. In April, UBS withdrew Gramm's lobbying registration, but one of his former congressional aides, John Savercool, is still registered to lobby legislators for UBS on numerous issues, including a bill cosponsored by Sen. Barack Obama that would crack down on foreign tax havens. ‘UBS is treating these investigations with the utmost seriousness and has committed substantial resources to cooperate,’ a UBS spokesman told NEWSWEEK, adding that Gramm was deregistered as a lobbyist because he spends less than 20 percent of his time on such activity. Hazelbaker said the McCain campaign ‘will not comment on the details … of ongoing investigations and legal charges not yet proved in court.’”

As a liberal blogger, I am especially proud how Newsweek acknowledged that, “last week liberal bloggers noted that Gramm was a registered UBS lobbyist on mortgage-securities issues until at least December 2007.”

We liberal bloggers must remain vigilant in the pursuit of truth and relentlessly remind people of what John McCain and his supporters are really about. McCain will try to portray himself as a maverick reformer and change agent. Facts are stubborn things though as Ronald Reagan used to stay. McCain’s longtime relationship with Phil Gramm suggests that a McCain presidency would represent more corporatism and class warfare waged from the top.