Big business tells Congress: 'Frightening' new proposal could 'destroy' Wall Street

Big business tells Congress: 'Frightening' new proposal could 'destroy' Wall Street

Some of the world’s most prominent CEOs will press New York lawmakers next Thursday to oppose legislation they argue would undermine the Big Apple’s economy and its reputation as a world financial hub.

Among roughly 20 business leaders slated to come to a meeting called by Rep. Charles Rangel (D-N.Y.) are: Rupert Murdoch, CEO of News Corp.; Lloyd Blankfein, CEO of Goldman Sachs; Larry Fink, CEO of BlackRock; and William Lauder, CEO of The Estee Lauder Companies Inc.


The industry leaders are concerned about legislation still being drafted that could give the federal government new powers to break up large financial firms even if they’re not about to threaten the economy.

The legislation will be one of several issues discussed at the Thursday meeting, during which business leaders will also talk about ways to improve the broader state of New York's economic health.

Rangel called a meeting of the New York congressional delegation at the request of the Partnership for New York City, a nonprofit group of business leaders.

Reps. Paul Kanjorski (D-Pa.) and Ed Perlmutter (D-Colo.) are working on amendments to broad financial overhaul legislation that may go much further than the Obama administration had initially proposed.

“If the U.S. dismantles our leading institutions, then it will destroy the American financial center, which is largely anchored in New York,” said Kathryn Wylde, president and CEO of the New York partnership. “It’s just frightening.”

Wylde’s group sent a letter to New York congressional lawmakers this week noting that financial, insurance and real estate business account for roughly 32 percent of New York’s overall economy.

House Financial Services Committee Chairman Barney Frank (D-Mass.) said recently that he was working on the amendments with Kanjorski and Perlmutter. The amendments would go further than legislation backed by President Barack ObamaBarack Hussein ObamaBiden hits 59 percent approval rating in Pew poll Cuba readies for life without Castro Biden can make history on nuclear arms reductions MORE that would give the government new powers to deal with financial firms that are failing and threaten to topple the broader economy.

“We're trying to rally the New York congressional delegation on an issue that again goes beyond regulation and starts making judgments about business plans that we don’t think are good for the New York economy,” said Wylde.

Lobbying groups for big financial firms have been racing to Capitol Hill in the last week to oppose the direction of the amendments. The Financial Services Forum, which represents 18 large financial companies, has organized more than half a dozen meetings with members.

“We will be active on Capitol Hill, pointing out the unique and important value large financial firms contribute to economic growth and job creation in the United States,” Rob Nichols, president of the forum, told The Hill this week.

-- This article was updated at 3:55 p.m.