Finance & Economy

Nation’s top banks spent big money on lobbying efforts during financial crisis

Eight of the nation’s largest banks spent nearly $26 million
lobbying federal lawmakers in 2009, during one of the most tumultuous periods
in financial history.

The banks spent nearly 6 percent more on federal lobbying last
year compared with 2008, according to a review of congressional lobbying
records. The banks spent $25.8 million on lobbying in 2009 and $24.4 million in
2008, the two years at the heart of the worst financial crisis since the Great

{mosads}The eight banks include: JPMorgan Chase & Co., Citigroup, Bank
of America, Morgan Stanley, Goldman Sachs, Wells Fargo, Bank of New York Mellon
and State Street. Those eight banks were the first recipients of taxpayer
bailouts at the end of 2008.

They have since repaid the aid and have seen their stock values
increase. They are now preparing to pay out massive compensation packages.
While the financial industry shows signs of improvement, the broader economy
remains bleak with 10 percent unemployment.

The banks are locked in a tough lobbying battle over new financial
regulations with other parts of the financial industry, consumer groups, labor
unions, congressional Democrats and the White House.

President Barack Obama has recently struck a tougher tone on big
banks and has criticized their lobbying efforts against the administration’s
regulatory plans. The House passed new regulations in December, but the Senate
has yet to hold a vote or mark up legislation in the Senate Banking Committee.

Industry lobbyists expect the biggest banks to continue to be
criticized heavily by the administration and by members of Congress. The
administration last week proposed a new fee on roughly 50 large financial firms
in an effort to raise $90 billion over 10 years to recoup the losses on the
government’s bailout efforts.

General Motors and Chrysler, as well as their finance arms, and
American International Group (AIG) received billions of dollars in bailout
money, much of which is not expected to be repaid anytime soon if ever. Fannie
Mae and Freddie Mac, the two housing giants, continue to operate under
government conservatorship.

JPMorgan was the biggest spender on federal lobbying in 2009 at
$6.17 million. That was roughly 14 percent more than the bank spent in 2008.

Citigroup was second at $5.5 million in 2009, a sum nearly
unchanged from 2008.

Goldman Sachs and Bank of America both decreased their spending on
lobbying by roughly 15 and 13 percent, respectively.

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