FacebookTwitterRedditEmail

The Demise of the Lincoln Derivatives Amendment

Blanche Lincoln, once a senator for Arkansas (1998-2010) noted for her fealty to Wall Street, has had one hope for immortality: Section 716 of the Dodd Frank Financial Reform Act, known to history as the Lincoln Amendment.

Though larded with loopholes, the amendment, introduced by Lincoln when facing a tough primary challenge from a progressive, made it harder for banks to trade derivatives.

Now, even that is about to be blown away like chaff, thanks to proposed legislation a mere four lines long, beautifully pure in its austere simplicity.

Lincoln’s amendment banned swaps – derivatives – trading by anyone on the receiving end of “Federal assistance.”

Federal assistance, otherwise known as taxpayer subsidies in the form of deposit insurance as
well as bailouts from the Federal Reserve is of course what the banks live by.   Strenuous efforts to gut the amendment, by Lincoln herself among others once she had won her primary, were not totally successful, thereby impinging on financial industry trading profits.

H.R. 1838,  introduced by Republican Nan Hayworth of New York (herself no slouch in collecting Wall Street cash)  sets things to rights in a straightforward manner. It simply states “Section 716 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (15 U.S.C. 8305) is amended by striking subsections (a) through (h) and (j) through (m) and redesignating subsection (i) as subsection (a).”  That’s it.

Assuming its eventual enactment (and why not?), derivatives trading, which was what brought the financial house down in 2008, can again flourish completely unfettered.

Just to be cruel, she or whoever wrote this has called it “The Swaps Bailout Prevention Act.”

ANDREW COCKBURN is the co-producer of the feature documentary on the financial catastrophe American Casino.  He can be reached atamcockburn@gmail.com

More articles by:

Andrew Cockburn is the Washington editor of Harper’s Magazine.  An Irishman, he has covered national security topics in this country for many years.  In addition to publishing numerous books, he co-produced the 1997 feature film The Peacemaker and the 2009 documentary on the financial crisis American Casino.  His latest book is Kill Chain: The Rise of the High-Tech Assassins (Henry Holt).

bernie-the-sandernistas-cover-344x550

June 19, 2019
Matthew Stevenson
Requiem for a Lightweight: the Mayor Pete Factor
Kenneth Surin
In China Again
Stephen Cooper
Abolishing the Death Penalty Requires Morality
George Ochenski
The DNC Can’t Be Allowed to Ignore the Climate Crisis
John W. Whitehead
The Omnipresent Surveillance State
William Camacaro - Frederick B. Mills
Guaidó’s Star Fades as His Envoys to Colombia Allegedly Commit Fraud With Humanitarian Funds for Venezuela
Dave Lindorff
What About Venezuela’s Hacked Power Grid?
Howard Lisnoff
Try Not to Look Away
Binoy Kampmark
Matters of Water: Dubious Approvals and the Adani Carmichael Mine
Karl Grossman
The Battle to Stop the Shoreham Nuclear Plant, Revisited
Kani Xulam
Farting in a Turkish Mosque
Dean Baker
New Manufacturing Jobs are Not Union Jobs
Elizabeth Keyes
“I Can’t Believe Alcohol Is Stronger Than Love”
June 18, 2019
John McMurtry
Koch-Oil Big Lies and Ecocide Writ Large in Canada
Robert Fisk
Trump’s Evidence About Iran is “Dodgy” at Best
Yoav Litvin
Catch 2020 – Trump’s Authoritarian Endgame
Thomas Knapp
Opposition Research: It’s Not Trump’s Fault That Politics is a “Dirty” Game
Medea Benjamin - Nicolas J. S. Davies
U.S. Sanctions: Economic Sabotage that is Deadly, Illegal and Ineffective
Gary Leupp
Marx and Walking Zen
Thomas Hon Wing Polin
Color Revolution In Hong Kong: USA Vs. China
Howard Lisnoff
The False Prophets Cometh
Michael T. Klare
Bolton Wants to Fight Iran, But the Pentagon Has Its Sights on China
Steve Early
The Global Movement Against Gentrification
Dean Baker
The Wall Street Journal Doesn’t Like Rent Control
Tom Engelhardt
If Trump’s the Symptom, Then What’s the Disease?
June 17, 2019
Patrick Cockburn
The Dark Side of Brexit: Britain’s Ethnic Minorities Are Facing More and More Violence
Linn Washington Jr.
Remember the Vincennes? The US’s Long History of Provoking Iran
Geoff Dutton
Where the Wild Things Were: Abbey’s Road Revisited
Nick Licata
Did a Coverup of Who Caused Flint Michigan’s Contaminated Water Continue During Its Investigation? 
Binoy Kampmark
Julian Assange and the Scales of Justice: Exceptions, Extraditions and Politics
John Feffer
Democracy Faces a Global Crisis
Louisa Willcox
Revamping Grizzly Bear Recovery
Stephen Cooper
“Wheel! Of! Fortune!” (A Vegas Story)
Daniel Warner
Let Us Laugh Together, On Principle
Brian Cloughley
Trump Washington Detests the Belt and Road Initiative
Weekend Edition
June 14, 2019
Friday - Sunday
Michael Hudson
Trump’s Trade Threats are Really Cold War 2.0
Bruce E. Levine
Tom Paine, Christianity, and Modern Psychiatry
Jason Hirthler
Mainstream 101: Supporting Imperialism, Suppressing Socialism
T.J. Coles
How Much Do Humans Pollute? A Breakdown of Industrial, Vehicular and Household C02 Emissions
Andrew Levine
Whither The Trump Paradox?
Jeffrey St. Clair
Roaming Charges: In the Land of 10,000 Talkers, All With Broken Tongues
Pete Dolack
Look to U.S. Executive Suites, Not Beijing, For Why Production is Moved
Paul Street
It Can’t Happen Here: From Buzz Windrip and Doremus Jessup to Donald Trump and MSNBC
Rob Urie
Capitalism Versus Democracy
Richard Moser
The Climate Counter-Offensive: Secrecy, Deception and Disarming the Green New Deal
FacebookTwitterRedditEmail