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Banking lobbyists, lawmakers gear up for a fight over new exec pay bill spurred by crisis on August 21, 2023 at 9:00 am Business News | The Hill

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Failures in the banking sector that nearly tanked the economy earlier this year resulted in a spate of legislative proposals aimed at punishing executives and reining in the banking sector.

They range from a Bernie Sanders (I-Vt.) plan to prohibit bankers from serving on Federal Reserve boards and acting as their own regulators to one from J.D. Vance (R-Ohio) and other senators diminishing failed bank executives’ enormous levels of pay.

But it is the RECOUP Act, sponsored by Banking Committee chair Sherrod Brown (D-Ohio), that was marked up in the Senate in June and could be the proposal most likely to make it into law, provided the House is interested in the bill as well.

Senators introduce bipartisan bill to allow seizure of pay from CEOs of failed banks

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Shorthand for the “Recovering Executive Compensation Obtained from Unaccountable Practices Act,” it would grant the Federal Deposit Insurance Corporation (FDIC) authority to take back compensation for senior executives at banks with $10 billion or more in assets in the event of a failure.

It would also increase “risk management” standards, “ensuring that management does not deviate from sound governance, internal control, or risk management; and ensuring appropriate long-term risk management tailored to long-term economic conditions,” according to the bill.

According to the Federal Reserve, 132 large commercial banks had assets over the $10 billion threshold as of June 30.

Of those, Bank of America, Citigroup, Morgan Stanley, Discover, TD Bank, Santander and Deutsche Bank — or firms lobbying on their behalf — disclosed work on the RECOUP Act during the second quarter, an analysis of federal lobbying disclosures by The Hill found.

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A source within Deutsche Bank was unfamiliar with work on the legislation, and Tiber Creek Group, the lobbying firm that disclosed monitoring the bill on their behalf, did not return a request for comment from The Hill.

Gregory Becker, former CEO of Silicon Valley Bank, arrives to testify to a Senate Banking, Housing, and Urban Affairs hearing examining the failures of Silicon Valley Bank and Signature Bank, Tuesday, May 16, 2023, on Capitol Hill in Washington. (AP Photo/Jacquelyn Martin)

Banking industry stays tight-lipped about what it wants

But most banks, accounting firms and industry groups that disclosed lobbying on the bill have not publicly stated their stance on the legislation, due in part to vagueness in the text about what the updated “risk management” and prudential standards actually mean.

These provisions “could include directing senior officers to implement and oversee reporting and information systems,” attorneys with Mayer Brown wrote in an analysis of the legislation.

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The Independent Community Bankers Association (ICBA) spent more than $2.3 million last quarter on federal lobbying efforts that include carving out exemptions for smaller banks in the RECOUP Act.

Bank executives blamed for failures during Senate hearing

“ICBA has worked with the congressional offices to include in the bill an exemption for community banks under $10 billion in assets,” the group wrote ahead of the Senate Banking Committee vote.

“ICBA continues working to increase the exemption threshold because, arguing the bill should address large banks with outlier business models, such as the failed Silicon Valley Bank and Signature Bank of New York.”

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ICBA declined to comment to The Hill further for this story. Morgan Stanley also declined to comment, and Bank of America, Citigroup, Discover and TD Bank did not return The Hill’s request for comment.

Tiber Creek Group disclosed monitoring the RECOUP Act on behalf of the U.S. Chamber of Commerce, the influential pro-business organization that spent $16.9 million on federal lobbying during the second quarter.

A Chamber spokesperson pointed The Hill to testimony from Tom Quaadman, executive vice president of the Chamber’s Center for Capital Markets Competitiveness, during a Senate Banking Committee hearing in May.

Quaadman told the committee that “clawbacks can be a tool to help disincentivize unsavory corporate behavior” and agreed “financial institutions should avoid excessive risk.”

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Lawmakers push major banking reforms following near collapse of financial sector

But he warned cracking down on incentive-based compensation might discourage talented individuals from working in finance at the chief executive and senior executive level.

“It might also chill the kind of healthy risk-taking – lending, financing and investing – that spurs economic growth and job creation in our capitalist system, resulting in corporate stagnation,” Quaadman added.

Other financial industry players told The Hill they are just keeping an eye on the legislation.

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Getting tough on bankers ahead of an election

The opportunity to look tough on banks has obvious appeal for lawmakers ahead of the 2024 election, as public opinion rages against bank bailouts and public rescues of private lending institutions.

“[Eighty four] percent of Americans agree – 56 percent agree strongly – that taxpayers should not have to foot the bill for irresponsible bank management, including 85 percent of Democrats and 86 percent of Republicans,” a Reuters Ipsos poll found in March.

Banks would lose $541 billion in ‘hard landing’ contingency: Fed

Bob Menendez (D-N.J.), along with Sens. John Tester (D-Mont.), Chuck Grassley (R-Iowa) and others, have their own piece of executive clawback legislation for failed bank executives.

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“Clearly, we need to ensure that poor managers can’t profit when their banks go under,” Sen. Menendez told The Hill in a statement.

“The RECOUP Act updates our laws on executive accountability to ensure that regulators can remove or prohibit senior executives who failed to oversee and manage risks in their banks and claw back their compensation,” he said.

A spokesperson for Tester told The Hill that “bank executives cashing out on their own failures flies in the face of Montana common sense.” 

“The Senator’s bipartisan legislation gives federal regulators the tools they need to claw back failed bank executives’ compensation and ban these bad actors from immediately re-entering the financial industry,” the spokesperson said.

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Sen. Bob Menendez (D-N.J.) arrives to the Capitol for a series of nomination votes on Thursday, February 16, 2023.

Whether representatives in the House will be interested to take up any of the proposals cooking in the Senate remains to be seen.

The House Financial Services Committee declined to give an update on the status of banking legislation.

The specter of the SVB collapse and the global financial crisis

Actions by executives involved in the banking crisis sparked concerns among the public and legislators that more regulation might be needed.

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Those include moves by Greg Becker, the CEO of Silicon Valley Bank, whose bank went under and almost pulled down the entire interconnected banking business, who sold millions of dollars worth of his own stock in the lead up to his bank’s collapse.

Becker, who was permitted to sit on the board of the San Francisco Federal Reserve as his own ostensible regulator, dumped more than $3 million in stock on February 27 amid regulatory warnings.

“You were paying out bonuses until literally hours before regulators seized your assets,” Senate Banking Committee chair Sherrod Brown told Becker in a hearing dedicated to his bank’s failure.

A free market no more? Rules of the game have changed after banking crisis, some say

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Becker and his fellow executives were blamed repeatedly for mismanaging their bank, investing in long-term securities whose exchange value was dropping just as the Fed was raising interest rates in response to inflation.

Fed regulators also admitted to a “shift in culture” that changed their supervision work, accepting part of the blame for a situation that raised the ghost of the 2008 financial crisis.

“The underlying issue the House Financial Services Committee has been focused on addressing is the lack of transparency and accountability surrounding bank regulators’ decision-making in crisis situations. The Increasing Financial Regulatory Accountability and Transparency Act, offered by Subcommittee Chairman Andy Barr, would do just that,” Laura Peavey, communications chief for the House Financial Services Committee, told The Hill.

​Business, News, banking crisis, FDIC, lobbyists, Silicon Valley Failures in the banking sector that nearly tanked the economy earlier this year resulted in a spate of legislative proposals aimed at punishing executives and reining in the banking sector. They range from a Bernie Sanders (I-Vt.) plan to prohibit bankers from serving on Federal Reserve boards and acting as their own regulators to one…  

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The Cities Bracing for Trump’s Immigration Crackdown

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In the wake of Donald Trump’s recent election victory and his promise of “the largest deportation operation in American history,” several major U.S. cities are bracing for potentially seismic shifts in their economic and social landscapes. As the nation grapples with the implications of this proposed policy, urban centers that have long been havens for immigrant communities find themselves at the epicenter of a looming storm.

Los Angeles, often dubbed the “City of Angels,” stands to lose more than its celestial nickname suggests. As a primary gateway for immigrants, the city’s vibrant tapestry of cultures and its economic engine could face significant disruption. From the bustling streets of Koreatown to the sun-drenched orchards of the Central Valley, the absence of undocumented workers could leave gaping holes in the city’s workforce and cultural identity.

Across the country, New York City, with its iconic skyline and melting pot reputation, faces its own reckoning. The Big Apple’s 5.9 million immigrants, many of whom are undocumented, form the backbone of industries ranging from construction to healthcare. The potential exodus could transform neighborhoods like Jackson Heights and Flushing, altering the very essence of what makes New York a global city.In the Sunshine State, Miami’s tropical allure belies the turbulent times ahead. Home to 2.5 million immigrants, the city’s economy relies heavily on sectors like tourism and hospitality – industries where undocumented workers often fill crucial roles. The potential deportation of these workers could send shockwaves through Miami’s economic ecosystem, from South Beach’s glitzy hotels to the agricultural heartlands of South Florida.

Chicago, the “City of Big Shoulders,” may find those shoulders significantly weakened. With 1.7 million immigrants in its metropolitan area, the Windy City’s diverse neighborhoods and industries face an uncertain future. From the meatpacking plants to the tech startups, Chicago’s economic resilience could be tested like never before.

In the Lone Star State, Houston and Dallas stand as twin testaments to the complexities of immigration policy. These Texas titans, each home to large immigrant populations, could see their booming economies stumble. The construction sites that dot their ever-expanding skylines and the service industries that keep these cities humming could face unprecedented labor shortages.

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Out West, the San Francisco Bay Area’s reputation as a bastion of innovation and progress could be challenged. The region’s tech industry, often reliant on immigrant talent, might find itself grappling with a new reality. From Silicon Valley’s coding campuses to the agricultural expanses of the Central Valley, California’s economic powerhouse could face a reckoning. Phoenix, rising from the Sonoran Desert, could see its growth trajectory altered. As Arizona’s urban center, it stands at the forefront of the immigration debate, potentially facing not just economic impacts but social and political upheaval as well.

These cities, along with others like San Diego and Las Vegas, are not just facing potential economic disruptions. They are staring down the barrel of profound social change. Family separations, community fragmentation, and the erosion of cultural enclaves built over generations are all possible consequences of mass deportations. Moreover, the fiscal implications are staggering. Undocumented immigrants contribute billions in taxes annually, often without receiving the full benefits of their contributions. Their sudden absence could leave gaping holes in city budgets, potentially affecting public services and infrastructure projects.

As these urban centers brace for impact, the debate rages on. Supporters of stricter immigration policies argue for the need to enforce laws and protect American jobs. Critics warn of economic devastation and the unraveling of America’s urban fabric. What’s clear is that America’s cities stand at a crossroads. The coming months and years will likely reshape urban landscapes in ways both visible and invisible. From the foods we eat to the services we rely on, from the neighborhoods we call home to the very character of our cities, the impacts of this proposed immigration crackdown could be far-reaching and long-lasting. As the nation watches and waits, these cities – vibrant, diverse, and economically vital – find themselves on the front lines of a policy that could redefine what it means to be an American city in the 21st century.

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How Trump’s Deportation Plans Could Reshape Major Cities

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In the wake of Donald Trump’s recent election victory, his ambitious plans for mass deportations have thrust America’s urban centers into the spotlight. As the nation grapples with the potential implications of what Trump calls “the largest deportation operation in American history,” cities across the country are bracing for significant changes that could reshape their economic, social, and cultural landscapes.

The stakes are particularly high for metropolitan areas like New York, Los Angeles, Houston, Dallas, and Miami, which host the largest populations of unauthorized immigrants. These cities, along with other major urban hubs such as Chicago, Washington D.C., and San Francisco, stand at the forefront of a looming transformation that could reverberate throughout the nation.

Economic Tremors

Economists warn that the proposed deportations could send shockwaves through urban economies. Mark Zandi, chief economist at Moody’s, cautions that businesses would face “significant challenges” if a substantial number of immigrants were removed. Industries such as construction, hospitality, and healthcare—pillars of urban economies—could face severe labor shortages.

Joe Brusuelas, chief economist at RSM, emphasizes the potential ripple effects: “The native-born workforce cannot meet current labor demands.” This labor gap could lead to increased wages, potentially rekindling inflation—a concern that looms large over city planners and policymakers alike.

Community Fabric Under Strain

Beyond economic considerations, the social fabric of cities hangs in the balance. Elena, a Nicaraguan immigrant in Houston, voices a fear echoed in immigrant communities across the nation: “I’m scared… This is my home.” The threat of family separations, particularly in mixed-status households, casts a long shadow over urban neighborhoods.

Immigrant advocacy groups like FIEL are mobilizing, advising clients to prepare for “anything that can happen.” This atmosphere of uncertainty could lead to decreased community engagement and cooperation with local authorities, potentially impacting public safety and community cohesion.

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Cities at a Crossroads

As the debate intensifies, cities find themselves at a crossroads. Some, like New York and Los Angeles, have historically positioned themselves as “sanctuary cities,” often at odds with federal immigration enforcement. The impending clash between federal policy and local governance promises to be a defining feature of this new political landscape.

Meanwhile, the logistical challenges of implementing such a massive deportation operation remain daunting. Questions abound regarding detention facilities, transportation networks, and the sheer manpower required to carry out Trump’s vision.

Looking Ahead

As America’s urban centers brace for potential change, the full impact of Trump’s deportation plans remains to be seen. Legal challenges are all but certain, and the resilience of America’s cities will be put to the test.

What is clear is that the coming months and years will be pivotal for urban America. As Jason Miller, a senior Trump adviser, puts it, the plan is to “immediately reinstate” immigration policies from Trump’s first term. For America’s cities, this could mean a period of unprecedented change, challenge, and, potentially, transformation.

As the nation watches and waits, the story of America’s cities in the face of this ambitious deportation plan is just beginning to unfold. The outcome will undoubtedly shape the future of urban life in America for years to come.

Bolanle Media is excited to announce our partnership with The Newbie Film Academy to offer comprehensive courses designed specifically for aspiring screenwriters. Whether you’re just starting out or looking to enhance your skills, our resources will provide you with the tools and knowledge needed to succeed in the competitive world of screenwriting. Join us today to unlock your creative potential and take your first steps toward crafting compelling stories that resonate with audiences. Let’s turn your ideas into impactful scripts together!

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Donald Trump Wins 2024 USA Election

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Based on the election results, Donald Trump has indeed won the 2024 U.S. presidential election, defeating Vice President Kamala Harris. Here’s an analysis of the key statistics and implications:

Electoral College Victory

Donald Trump has secured the presidency by winning crucial battleground states and flipping some key states that were previously held by Democrats. The final Electoral College tally is still being determined, but Trump has surpassed the 270 electoral votes needed to win.

Battleground State Performance

Trump’s victory was largely secured by winning several critical swing states:

  • Wisconsin: Trump’s win here was pivotal in securing his path to victory.
  • Pennsylvania: This state flipped back to Republican control.
  • Georgia: Another key state that Trump managed to win back.
  • Michigan: Trump successfully flipped this traditionally Democratic stronghold.

While the final popular vote tally is still being calculated, exit polls provide insight into voter priorities:

Congressional Control

The election results extend beyond the presidency:

Media Implications

The outcome of this election could be seen as a challenge to mainstream media narratives for several reasons:

  1. Polling Discrepancies: Many pre-election polls suggested a tight race or even a slight Harris advantage in key states. Trump’s victory, particularly in battleground states, may indicate that polls underestimated his support.
  2. Narrative Shifts: Throughout the campaign, much of the mainstream media focused on Trump’s legal challenges and controversies. His victory suggests that these issues may not have resonated with voters as much as economic and policy concerns.
  3. Voter Priorities: The emphasis on issues like the economy and immigration in voter decision-making may indicate a disconnect between media focus and voter concerns.
  4. Electoral Predictions: Many mainstream outlets were cautious about predicting a Trump victory, even as results began to favor him. This hesitancy could be seen as a reflection of broader media skepticism about Trump’s chances.
  5. Underestimation of Trump’s Base: The results suggest that Trump’s core support remained strong and potentially grew, despite negative coverage in much of the mainstream media.

It’s important to note that while the election outcome may challenge some media narratives, it doesn’t necessarily invalidate all mainstream reporting. The complex factors influencing voter behavior and the challenges of accurate political forecasting remain subjects of ongoing analysis and debate.

As the dust settles on this historic election, both the media and political analysts will likely engage in extensive reflection on the factors that led to Trump’s victory and the implications for future political coverage and analysis.

Bolanle Media is excited to announce our partnership with The Newbie Film Academy to offer comprehensive courses designed specifically for aspiring screenwriters. Whether you’re just starting out or looking to enhance your skills, our resources will provide you with the tools and knowledge needed to succeed in the competitive world of screenwriting. Join us today to unlock your creative potential and take your first steps toward crafting compelling stories that resonate with audiences. Let’s turn your ideas into impactful scripts together!

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