‘Padlock the revolving door’: Warren makes anti-corruption pitch

WASHINGTON — Wall Street’s toughest critic in the Senate has unveiled comprehensive legislation to limit the revolving door between corporations and the government, touting it as the “most ambitious anti-corruption legislation proposed in Congress since Watergate.”

“At a time when this country faces enormous challenges, our government actively serves the richest and most powerful and turns its back on everyone else,” Sen. Elizabeth Warren, D-Mass., said in a speech at the National Press Club Tuesday.

While the bill is likely dead on arrival in the GOP-controlled Congress, Warren's legislative push is yet another sign that she is setting her sights on a presidential run in 2020. It comes as she has continued to blast recent deregulation efforts and praised the Dodd-Frank Act.

Joshua Roberts/Bloomberg

The legislation includes a ban on individual stock ownership by members of Congress, Cabinet secretaries, senior congressional staff, White House staff, federal judges and senior agency officials. It also includes restrictions on former federal employees joining the lobbying ranks, as well as on lobbyists going to work for the government, among other things.

The bill would prohibit the world’s biggest companies, including banks, from hiring former senior government officials for four years after they leave the public sector. It would impose lifetime lobbying bans on presidents, vice presidents, members of Congress, federal judges and Cabinet secretaries. Lobbyists, meanwhile, could not take government jobs for two years; that period is six years for "corporate lobbyists."

"Sure, there's lots of expertise in the private sector, and government should be able to tap that expertise," Warren said. "And, yes, public servants should be able to use their expertise when they leave government. But we've gone way past expertise and are headed directly into graft. Padlock the revolving door."

The legislation would also reform the Congressional Review Act, which allows lawmakers to block recent rulemakings and has been used by the GOP-held Congress to unwind some financial regulatory policies.

Under those review powers, Congress can do more than just expunge a rule. Once a regulation is blocked, agencies are also barred from ever reviving a similar rule. But Warren's bill would give regulators the ability to issue regulations that resemble those that were previously overturned.

In her speech, Warren called out numerous government officials, both current and former, that she said favored the interests of industry over those of the public.

In particular, she criticized Gary Cohn, the former National Economic Council director who was a Goldman Sachs executive before joining the Trump administration; Mick Mulvaney, the director of the Office of Management and Budget and acting Consumer Financial Protection Bureau director; and Mary Jo White, the former Securities and Exchange Commission chair in the Obama administration, who was an industry attorney before and after her stint at the SEC.

“Goldman Sachs handed Gary Cohn over a quarter of a billion dollars on his way out the door to become the head of President Trump's National Economic Council,” Warren said. “A quarter of a billion dollars to help quarterback a tax package that included giveaways worth just over a quarter of a billion to Goldman — in the first quarter of 2018 alone. That's quite the return on investment for Goldman Sachs.“

And she continued her criticism of Mulvaney over remarks he made at an American Bankers Association conference earlier this year about which lobbyists he was willing to speak with when he was a member of Congress. She described him as “Exhibit A” of corruption in Washington, and noted that in response to his ABA comments, “Trump and pretty much every Republican in Washington just shrugged.”

Warren’s criticism of Washington and Wall Street has not been limited to Republicans. She criticized several Democrats who voted in support of a bipartisan regulatory relief bill that President Trump signed into law in May.

And she was a critic of White, an Obama appointee. At one point she had asked the former president to remove White from the SEC.

“Look at Mary Jo White, she worked on Wall Street, worked for the Wall Street companies, biggest Wall Street companies,” Warren said in response to an audience question. “She gets nominated to head the SEC. She comes into the SEC, does the lightest touch on regulation. Never completes the rules on corporate campaign contributions, never finishes part of the agenda that was serious about trying to crack down on corporations and then whisks right down through the revolving door and is out representing those same folks again.”