Joint Statement: Democratic Platform Calls for Strong Steps to Curb Revolving Door Abuses

DNC Platform Will Ban Golden Parachutes, Limit Conflicts of Interest by Wall Street Regulators

We are pleased that the platform that will be confirmed by the Democratic National Committee (DNC) this week includes strong solutions for dealing with some of the nation’s worst revolving door abuses, a coalition of groups said today.

Specifically, the draft platform states, “We will crack down on the revolving door between the private sector – particularly Wall Street – and the federal government. We will ban golden parachutes for those taking government jobs. We will limit conflicts of interest by requiring bank and corporate regulators to recuse themselves from official work on particular matters that would directly benefit their former employers. And we will bar financial service regulators from lobbying their former colleagues for at least two years.”

The language mirrors important policy found in The Financial Services Conflict of Interest Act introduced in the U.S. House of Representatives last year. The platform gets to the root of a critical problem in America: Wall Street’s capture of the financial services agencies charged with regulating it. Inappropriate corporate influence at the highest levels of government is not compatible with protecting Main Street Americans, the groups maintain.

“We applaud the DNC platform for its commitment to ban government service golden parachutes and limit conflicts of interest by Wall Street regulators,” said AFL-CIO President Richard Trumka. “Government service golden parachutes are backdoor bribes to future government officials. They should be illegal – plain and simple. We strongly support Senator Baldwin’s and Representative Cummings’ Financial Services Conflict of Interest Act. As long as the practice remains legal, we intend to keep pushing as shareholders to ban government service golden parachutes at the Wall Street banks.”

“We are thrilled that the DNC platform took this landmark stand on the issue of personnel – recognizing the inextricable link between who runs our banking regulators and how tough we are on Wall Street. Closing the rapidly spinning revolving door between government and industry and doing away with conflicts of interest are a necessary step the next administration must take to start repairing trust in government,” said Lisa Gilbert, director of Public Citizen’s Congress Watch division.

“We thank the Democratic Party for taking steps to realign the incentives of our government by closing the revolving door between representing elected power and representing industry. The platform language is a great first step and is a testament to the electoral power of democracy-driven messaging. However, it is vitally important that this platform leads to action. Democracy Matters students across the country will be watching,” said Max Stahl, director of political engagement at Democracy Matters.

“The platform’s strong language on shutting down the revolving door is a dramatic turnaround for the Democratic Party. Still today, multiple agencies in the Obama administration are run by individuals who took millions in golden parachute bonuses from Wall Street for joining the government. Now, the official position of the Democratic Party is that those golden parachutes should be prohibited; cutting off a major way Wall Street works to rig the rules in its favor. We look forward to applying these standards during the transition to the next Democratic administration,” said Kurt Walters, campaign director of the Rootstrikers project at Demand Progress.

“The financial crisis of 2008 exposed glaring weaknesses not only in the regulations governing Wall Street, but in the institutions charged with writing and enforcing them. It is good news that the Democratic platform includes language highlighting the revolving door and affirming a set of concrete steps to deal with aspects of this problem. It is of the utmost importance that any next president appoint regulators who are willing to stand up to Wall Street in order to stand up for the rest of us,” said Lisa Donner, director of Americans for Financial Reform.

“Addressing the revolving door between government and industry is a critical step in ensuring that government officials work for the benefit of the people, not powerful interests,” said Noah Bookbinder, president for Citizens for Responsibility and Ethics in Washington.