Bloomberg throws Wall Street under campaign bus

What Wall Street employee wouldn’t love to see Michael Bloomberg in the White House? The would-be Democratic nominee knows the industry better than any previous US president, and his self-funding campaign isn’t going to cost them a penny in contributions. True, his plan to rein in the excesses of the financial sector, released on Tuesday, looks like throwing the clients of his financial-data business under the bus. But it’s necessary for Bloomberg to be taken seriously in the Democratic field.
The New York-based billionaire revealed a list of proposed policies aimed at “unscrupulous brokers and lenders.”
His ideas range from forcing banks to hold more equity capital to making sure that credit-scoring algorithms are tested for racial and gender bias. While he doesn’t argue for breakups of big firms, as rival Bernie Sanders does, or for a wealth tax like Elizabeth Warren’s, his policies would still depart from the cozy status quo.
Among those most inimical to his clients’ interests are a tax on financial trades and a pledge to tighten up trading and capital rules. The first isn’t exactly original — Warren, Sanders and Pete Buttigieg have all backed similar schemes — nor necessarily very impactful.
The Tax Policy Center has estimated that a 0.1 per cent levy on trades would raise little more than $50 billion a year. As for trading rules, getting five agencies, including the Federal Reserve, to coalesce is easier said than done.
Nonetheless, Bloomberg’s proposals carry weight, because he’s an industry insider. Many of them are sensible, too, like addressing the slow collapse of the minority-owned banking sector, and beefing up the Consumer Financial Protection Bureau, which was created after the financial crisis in part thanks to Warren’s advocacy but has been severely weakened under President Donald Trump.
Bloomberg needed to do something. His connections to the vested interests of high finance make an obvious target for more progressive contenders for the Democratic nomination — and the billionaire now polls high enough to have to face off with them on the debate stage.
As for his business’s customers, while they might complain, his policies are less likely to end up badly crimping their profit than, say, those of Sanders. Banks can just rationalise any mild hit as a campaign contribution by another name. — Reuters