{"id":74604,"date":"2016-06-06T12:00:56","date_gmt":"2016-06-06T11:00:56","guid":{"rendered":"https:\/\/www.transcend.org\/tms\/?p=74604"},"modified":"2016-06-04T16:29:59","modified_gmt":"2016-06-04T15:29:59","slug":"money-merry-go-round-emails-show-how-wall-street-execs-and-alums-crafted-trade-bill","status":"publish","type":"post","link":"https:\/\/www.transcend.org\/tms\/2016\/06\/money-merry-go-round-emails-show-how-wall-street-execs-and-alums-crafted-trade-bill\/","title":{"rendered":"Money Merry-Go-Round: Emails Show How Wall Street Execs and Alums Crafted Trade Bill"},"content":{"rendered":"

FOIA disclosure documents chummy relationship between trade negotiator and big investment banks.<\/em><\/p>\n

\"US<\/a>

US Trade Representative Michael Froman worked for Citigroup before joining the Obama administration. (Photo: Gabriella Demczuk\/Getty Images)<\/p><\/div>\n

2 Jun 2016 – <\/em>Foreign corporations could sue to undermine US protections for consumers\u2019 health, safety and financial security under a provision added to the proposed Trans-Pacific Partnership trade deal (TPP) after executives of big banks pressed the nation\u2019s chief trade negotiator, himself a former big-bank executive, to include it.<\/p>\n

A series of emails<\/a>, obtained under the Freedom of Information Act and released last week by Rootstrikers<\/a>, an organization that opposes the trade deal now pending before Congress, confirm the push by financial service companies for the \u201cInvestor-State Dispute Settlement\u201d provision. ISDS, as it is referred to by the cognoscenti writing the emails, would, in the words of one critic, Public Citizen\u2019s Lori Wallach, \u201celevate individual investors to the status of a nation-state\u201d in trade disputes.<\/p>\n

The emails also are bound to reinforce the suspicion that US trade policy is being set by what might be called an \u201cexecutariat\u201d of corporate and government leaders who periodically swap positions for their mutual benefit. \u201cThey\u2019re written as if they are being sent between colleagues,\u201d says Dennis Kelleher of the watchdog group Better Markets<\/a>. \u201cThat\u2019s because the writers all have been, currently are or will be colleagues at major Wall Street firms.\u201d<\/p>\n

Most striking is an exchange between Faryar Shirzad<\/a>, the co-head of Goldman Sachs\u2019 government affairs office, and US Trade Representative Michael Froman<\/a>.<\/p>\n

The two men have mirror-image resumes: Shirzad worked on economic and international issues in the administration of then-President George W. Bush, serving as a top aide to the president (known as a \u201csherpa\u201d) at several international economic summits.<\/p>\n

Froman worked for some of the same agencies as Shirzad, but in the administration of former President Bill Clinton. He sat out the Bush years in the private sector<\/a> as a managing director of Citigroup, then swirled back through the revolving door into Barack Obama\u2019s administration. At several international economic summits, Froman also served as the president\u2019s sherpa. He became\u00a0US trade representative in 2013 \u2014 but not before his financial holdings raised some eyebrows<\/a> on Capitol Hill.<\/p>\n

Others on Froman\u2019s email chain included: Matt Niemeyer<\/a>, another Goldman Sachs vice president and Bush administration alum, and Tom Nides<\/a>, who in 2013 returned to a high-ranking post at Morgan Stanley after taking a three-year hiatus to serve as one of Hillary Clinton\u2019s deputies at the State Department.<\/p>\n

The ISDS issues came up in an\u00a0email from Shirzad and in another from Froman to an unidentified employee at JPMorgan Chase (names of recipients were redacted). \u201cThis is really not helpful\u201d before appending a Politico<\/em> story, clearly pegged to leaks, that described a\u00a0split in the administration over ISDS, with several agencies, including the Treasury Department, opposing the provision and the trade representative\u2019s office siding with the big banks in favor of it.<\/p>\n

In its online sales pitch for the Trans-Pacific Partnership, the trade representative\u2019s office argues that the ISDS provision will help protect Americans\u2019 investments<\/a> in other countries. But others vehemently disagree. As written, says Public Citizen\u2019s Wallach, the provision represents \u201ca huge expansion\u201d of corporate power that would \u201cempower major global financial firms to attack to US financial regulations using ISDS. That was the scenario outlined by\u00a0Sen. Elizabeth Warren last year in a Washington Post<\/em> op-ed<\/a>. The Massachusetts Democrat warned that the trade pact\u2019s ISDS provision will\u00a0undermine US sovereignty by making it easier for US laws and regulations to be challenged\u00a0by foreign companies. Kelleher thinks the ultimate beneficiary may be financial services companies right here at home. Wall Street firms \u201chave a clear strategy, he contends, to use trade laws \u201cto grease the skids to the regulatory bottom.\u201d<\/p>\n

Other emails in the Rootstriker disclosure appeared to be designed to reassure Froman that the financial services industry is using its muscle to win congressional votes for the Trans-Pacific trade deal. In a sign of the political radioactivity surrounding it, backers \u2014 including congressional Republican leaders and the Obama administration \u2014 appear to be teeing it up for vote in a lame-duck session<\/a> of Congress later this year.<\/p>\n

“Great to see you last weekend.”\u2014 Goldman Sachs CEO Gary Cohn to US Trade Representative Michael Froman<\/em><\/strong><\/p>\n

One note, forwarded by Nides, included an open letter urging members of the New York congressional delegation to support the trade deal. It was signed by members of the Partnership for NYC, a group of corporate leaders<\/a> headed by the CEOs of Morgan Stanley and Blackstone. In April, Gary Cohn, the CEO of Goldman Sachs, sent along a 27-page report his company produced for investors on the trade deal, along with a chipper note that it was \u201cgreat to see you last weekend.\u201d<\/p>\n

Such chummy banter reveals just how much influence Wall Street has over trade deals, says Better Markets\u2019 Kelleher. \u201cIt\u2019s not a back channel,\u201d he says. \u201cIt\u2019s an open door.\u201d In order to prevent the trade representatives\u2019 office from falling prey to what economists like to call \u201cregulatory capture<\/a>,\u201d Froman says, \u201cthere must be far more transparency by Froman as to who he\u2019s talking to.\u201d<\/p>\n

\u201cI\u2019m all for stakeholders having influence and access,\u201d adds Kelleher, \u201cbut big banking and Wall Street always have special access.\u201d<\/p>\n

BillMoyers.com asked the trade representative\u2019s office for response to the Rootstrikers email disclosure and for documentation of similar communications with labor, consumer and environmental organizations lobbying on the trade bill. We will update this post if we receive any.<\/p>\n

Kurt Walters of Rootstrikers said his group believes that the six emails their FOIA unearthed represent \u201cthe tip of the iceberg\u201d of\u00a0communications between the trade representative and Wall Street firms. Noting references to personal meetings and plans to delegate communications to deputies, Walters said \u201cwe\u2019re thinking very seriously of filing additional FOIAs.\u201d But the process can be lengthy: It took nearly a year for Rootstrikers to obtain the communications released last week.<\/p>\n

________________________________________<\/p>\n

Kathy Kiely, a Washington, DC-based journalist and teacher, has reported and edited national politics for a number of news organizations, including<\/em> USA Today, National Journal, The New York Daily News and<\/em> The Houston Post. She has been involved in the coverage of every presidential campaign since 1980.<\/em><\/p>\n

This work is licensed under a Creative Commons Attribution-Share Alike 3.0 License.<\/em><\/p>\n

Go to Original \u2013 commondreams.org<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

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