Mr. President, I ask unanimous consent that the order for the quorum call be rescinded. Mr. President, when he was running for President, Donald Trump laid out a pretty clear vision of how he would…
Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.
Mr. President, when he was running for President, Donald Trump laid out a pretty clear vision of how he would deal with Wall Street. He said: ``Wall Street has caused tremendous problems for us.'' He claimed he wasn't ``going to let Wall Street get away with murder,'' and he called out Goldman Sachs as the prime example of a big bank that has too much influence over the political process. That was really powerful stuff.
When Candidate Trump became President Trump, he seemed to forget every scrap of his tough-on-Wall Street talk. Within weeks of taking office, he turned over his administration's economic agenda to none other than Goldman Sachs. His senior strategist, Steve Bannon, spent half a decade at Goldman Sachs as an investment banker. His National Economic Council Director, Gary Cohn, came directly from Goldman Sachs, where he spent 25 years and rose to become President of the bank. His Secretary of the Treasury, Steve Mnuchin, spent 17 years at Goldman Sachs before leaving to start his own hedge fund, which brings us to Jay Clayton, President Trump's nominee to run the Securities and Exchange Commission. To be fair, Mr. Clayton never worked at Goldman Sachs, he just worked for Goldman Sachs, taking their money and representing them for years as a lawyer at a major New York City law firm.
So here we are, just over 8 years after Wall Street triggered a financial crisis and brought the economy to its knees, and President Trump has put the Goldman Sachs gang in charge of holding Wall Street accountable. Trump's betrayal of his campaign promises on Wall Street is shameful, but it is also dangerous, especially when it comes to picking the person to lead the SEC. The SEC is supposed to be the cop on the beat for Wall Street. That is why Congress created it in the 1930s, after fraud and other misconduct on Wall Street led to an enormous stock market crash and the Great Depression. Congress gave the SEC the authority to oversee financial markets and to hold companies and individuals accountable when they defrauded investors.
When the SEC doesn't do its job, the consequences can be devastating. Look at what happened the last time the SEC was under Republican control in the years leading up to the 2008 crisis. The SEC was asleep at the switch. While Wall Street flooded the market with dangerous securities and lied to investors, the SEC heard nothing, saw nothing, stopped nothing. The Republican-led SEC did nothing. When the whole market blew up, it was ordinary
investors and working families who got asked to bail out Wall Street.
So what kind of SEC Chairman would Mr. Clayton be? Let's start by looking at how he would lead the SEC's enforcement efforts against Wall Street, how he would be as a cop on the beat. Under ethics rules, for the first half of his term, Mr. Clayton cannot participate in any enforcement action that involves one of his former clients. That means he cannot take part in any case against Goldman Sachs. OK. But there is more. Goldman Sachs is just one of his former big bank clients. Mr. Clayton also can't take action against Deutsche Bank or against UBS or against Barclays. These are some of Wall Street's biggest and most egregious repeat offenders, and Mr. Clayton would be barred from enforcing the law against them.
That is not all. Ethics rules also prevent Mr. Clayton from participating in any enforcement case against a party that is represented by his former law firm, Sullivan and Cromwell. Sullivan and Cromwell is a premier Wall Street firm, with a long client list that includes big banks like JPMorgan Chase and the credit rating agency Moody's. That means there will likely be even more cases against top Wall Street firms that Mr. Clayton can't work on.
Here is why that matters so much. For most enforcement actions, it takes a majority vote of the five SEC Commissioners. In other words, it takes three people to advance an enforcement action. In a number of recent cases, the two Democrats have voted for stronger enforcement and the two Republicans have voted against it. If the Chairman can't vote-- and Mr. Clayton can't vote if some of the biggest and most disreputable banks are involved--then the Commission is likely to come up short of the necessary three votes. You know what that means. It means the banks walk free. Confirming Mr. Clayton to run the SEC will almost certainly result in weaker enforcement against the major players on Wall Street.
Mr. Clayton is also likely to pursue a Wall Street-friendly agenda when it comes to the SEC's rulemaking responsibilities. When he testified before me and before other members of the Banking Committee, Mr. Clayton refused to commit to completing the rules that Congress asked the SEC to write all the way back in 2010 as part of its postcrisis financial reforms. Mr. Clayton even refused to commit to implementing and enforcing some of the postcrisis rules that the SEC has already finalized and put in place.
I don't have any faith that Mr. Clayton will be the kind of tough, independent leader we need at the SEC. His nomination is just one more broken promise, one more time that Donald Trump has put Wall Street ahead of the interests of the American people. The last time a Republican President led us down this path, it resulted in the worst financial crash of our lifetime. We can't go down that path again.
I will be voting against Mr. Clayton's nomination, and I urge my colleagues to do the same.
Thank you, Mr. President.
I yield the floor.
I suggest the absence of a quorum.
