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I didn't - when was he on? I'll go online and look.


Eric D. Schwerin
Rosemont Seneca Partners, LLC
1010 Wisconsin Ave., NW
Suite 705
Washington, DC 20007
(202) 333-1880
[email protected]
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On Apr 27, 2010, at 3:51 PM, [email protected] wrote:

Did you see him on CNN- he was awesome.
Sent on the Sprint® Now Network from my BlackBerry®

From: Eric Schwerin <[email protected]>
Date: Tue, 27 Apr 2010 15:49:50 -0400
To: Hunter Biden<[email protected]>
Subject: The Most Important Person You've Never Heard of in
Washington's Push to Reform Wall Street

The Most Important Person You've Never Heard of in Washington's Push
to Reform Wall Street
Sen. Ted Kaufman Says in an Exclusive Interview That Dems' Proposals
Won't Work

Source: ABC News

By MATTHEW JAFFE

April 23, 2010


He might be the most important player you've never heard of in
Washington's push to crack down on Wall Street.

When it comes to the biggest regulatory shakeup since the Great
Depression, Sen. Ted KAUFMAN, D-Del., does not back the views of Wall
Street or Republicans or Democrats, or even the Obama administration.

The man who served more than two decades as a top aide to Vice
President Joe Biden -- and was his hand-picked choice to take over the
Senate seat he vacated -- is very much his own man on the issue of the
moment.

KAUFMAN has staked out his own position: the government should break
up the country's biggest banks to make sure that no firm is ever again
considered too big to fail.

End 'Too Big to Fail'

"The thing I'm most focused on is too big to fail," said KAUFMAN in an
exclusive interview with ABC News. "That trumps just about everything
else. We just cannot have a financial institution that is too big to
fail, meaning they have to be nursed along or bailed out by the U.S.
government. That cannot happen again."

But the proposal championed by KAUFMAN's fellow Democrat, Senate
Banking Committee chairman Chris Dodd would not break up existing big
banks.

"I just don't think it'll work," KAUFMAN said. "I'm concerned about
whether it'll work with these really big banks because they're so
complex, and there are so many international connections.

"I absolutely think the world of Chris Dodd. I just have a difference
of opinion," KAUFMAN said. "My basic view of the world is these
[banks] are too big to fail, and therefore that's what I'm pushing for."

If you don't know who Ted KAUFMAN is, that's probably because he only
became a senator last year, when Biden became vice president. And
he'll be a former senator by this time next year, having ruled out
running for a term in his own right.

KAUFMAN served as Biden's chief of staff for 22 years, and the two
remain close friends, though he hasn't always been the
administration's ally.

His decision not to seek another term, he said, is not what's
motivated him to become more aggressive in the push for financial
reforms. Nor has it coaxed him into reflexive support for the
Democrats' party line.

"There's not a single thing that I would do differently if I was
running this year," he said.

Bring Back Glass-Steagall

No, KAUFMAN's passion for a Wall Street overhaul can be traced not to
his one-and-done stint in the Senate or even to the financial meltdown
of 2008, but to his time in Philadelphia in 1966. That is the year
KAUFMAN graduated from the University of Pennsylvania's Wharton School
of Business, where he studied the Glass-Steagall Act, landmark
legislation from the early 1930s that separated investment and
commercial banking activities.

As the years passed, though, KAUFMAN saw the government slowly start
to move away from such Wall Street restrictions. In 1999, during the
Clinton administration, Glass-Steagall was repealed. Now KAUFMAN wants
it back.

"Investment banks and commercial banks shouldn't be under the same
roof," he said. "I'm going to keep saying it and saying it and saying
it. This is a very important part if we don't want to go down this
road again."

Another factor that sent the country spiraling into recession was weak
oversight by federal regulators charged with keeping an eye on the
financial system during the Bush administration. That, too, he said,
needs to change.

"We had a group that came in and said, 'We don't need regulators.
Let's just throw the referees off the football field and see what
football's like without any referees.' And we found out: It's pretty
ugly. We went down a path that turned out to be a dead end, and it
almost destroyed the country," KAUFMAN said. "We need to get back to a
time where we have referees on the field watching what goes on."

But it is KAUFMAN's push to break up the country's biggest banks that
has earned him raves from such leading experts as Simon Johnson,
former chief economist at the International Monetary Fund.

"Sen. Ted KAUFMAN is a strident critic of our current financial system
and a tough voice for greatly strengthening the Dodd bill," Johnson
recently wrote on his blog the Baseline Scenario. "Sen. KAUFMAN," he
said, "is exactly right to press for more."

In a statistic KAUFMAN frequently cites, 15 years ago the six biggest
U.S. banks had assets that equaled 17 percent of the nation's gross
domestic product. Today that number has soared to more than 63 percent
of GDP. Three banks have nearly $2 trillion in assets on their balance
sheets.

Citigroup -- Nearly $2 Trillion in Assets

One of these banks is Citigroup, which needed $45 billion in taxpayer
bailout money after the financial meltdown in September 2008. At a
hearing before the Financial Crisis Inquiry Commission April 8, Robert
Rubin, a former senior adviser to Citigroup and Treasury Secretary in
the Clinton administration, told the panel that he was not aware that
the bank held more than $40 billion in complex mortgage-backed
securities until a few months before the meltdown. That, KAUFMAN said,
is evidence that these banks have grown too large -- top executives do
not even know what is happening on their watch.

"Too big to manage, too big to regulate, and too big to fail -- there
are a lot of indications that these banks are just too big," he said.

White House adviser Paul Volcker's proposal to ban big commercial
banks, whose deposits are FDIC insured, from engaging in "proprietary
trading," a risky but profitable activity, could help. "If banking
institutions are protected by the taxpayer and they are free to
speculate, I may not live long enough to see the crisis, but my soul
is going to come back to haunt you," Volcker, a former president of
the Federal Reserve, told Dodd's Senate Committee on Banking panel in
February.

Earlier this week KAUFMAN and a group of other Democratic senators
proposed a bill that would cap the size of banks by dictating that
they cannot hold liabilities of more than 2 percent of GDP, or 10
percent of the total bank deposits in the country. Bank of America,
Wells Fargo, and JP Morgan Chase would be the three banks immediately
impacted by such a bill.

KAUFMAN is not a member of the Senate Banking Committee, so his
influence has been limited. But the Delaware senator has already left
a lasting mark as a member of the Senate Judiciary panel on fighting
financial fraud.

Last January, on his first day in office, KAUFMAN's fury at Wall
Street after the financial meltdown incited him to go to the Judiciary
panel's chairman, Sen. Patrick Leahy, D-Vt., and voice support for the
creation of a task force to go after financial fraud. A few months
later, President Obama signed the Leahy-Grassley-KAUFMAN bill into
law. And last fall the president formed a task force to improve
communication among regulators.

In the coming weeks, as financial regulatory reform takes center stage
on Capitol Hill, KAUFMAN will get the chance to leave another lasting
mark as the Senate begins its debate on Dodd's proposal. But even
though the Democrats' proposal may not be as strong as KAUFMAN would
like, he does not sound prepared to vote against it.

"I think over the last few weeks the momentum is on the side of folks
who want to make this bill stronger," he said. "I don't see how people
can vote against a financial regulatory bill like this one. It's not
as strong as I'd like it, it doesn't have a section in it that I'd
like it to have, but this bill or nothing? That's an easy choice."


Eric D. Schwerin
Rosemont Seneca Partners, LLC
1010 Wisconsin Ave., NW
Suite 705
Washington, DC 20007
(202) 333-1880
[email protected]
P Consider the environment before printing this email.