“I believe that the very hard choices that the President and his economic team made early on in the administration laid the groundwork, both to prevent worse economic consequences and to begin the climb out of the deep hole that we were in. And now the rest of the world, the IMF just basically said, we’re the only country growing with projected robust growth.” – Hillary Clinton, Economic Club of Chicago, 10/8/14
Balancing a free and fair economy.
During her 2008 presidential campaign, Hillary Clinton said “fairness doesn’t just happen. It requires the right government policies.” It was during that campaign that one New York Times columnist estimated that Hillary “might bring the toughest regulatory scrutiny of any president in a generation.” Reflecting on America’s 20th century economic history, Hillary said “we were most successful when we had that balance between an effective, vigorous government and a dynamic, appropriately regulated market… And we have systematically diminished the role and the responsibility of our government, and we have watched our market become imbalanced.”
Protecting the financial health of the American people.
Hillary Clinton put Elizabeth Warren’s idea of a Financial Product Safety Commission “at the heart” of her financial reform agenda, calling for its creation so it could “crack down on abusive and predatory lenders and to protect consumers.” This idea – now known as the Consumer Financial Protection Bureau – was implemented two years later in the Dodd-Frank Wall Street reform law of 2010. And in 2006, Hillary introduced legislation to require financial companies give consumers a copy of all company records related to a given consumer every year free of charge.
Fighting for accountability and independent oversight.
In 2008, Hillary Clinton urged the SEC to restore the so-called “uptick rule” to prevent abusive short-selling and reduce market volatility. “The abuses that disrupt the markets today will impact the broader economy and the lives of middle class Americans tomorrow,” Clinton wrote. The SEC adopted a revised “uptick rule” in 2010 to place restrictions on short selling and “preserve investor confidence and promote market efficiency.” Hillary also called for addressing the conflicts-of-interest between credit rating agencies and financial institutions and, two years later, the Dodd-Frank Wall Street reform law enhanced SEC oversight of these agencies.
Opening up the CEO compensation process.
Hillary Clinton introduced legislation to provide shareholders a vote on executive compensation, especially on benefits packages for executives when companies are merged or bought out, so-called “golden parachutes.” The Dodd-Frank Wall Street reform law included a similar “say on pay” provision. Hillary’s bill also would have created a three year look-back period (also known as a “claw-back” policy) within which the SEC could require CEOs and CFOs to repay bonuses, profits or other compensation if they were found to have overseen or been complicit in corporate misconduct or illicit activity. While the Dodd-Frank Wall Street reform law includes claw-back provisions, the SEC rule-making process is ongoing.
Cracking down on tax loopholes for hedge fund and private equity managers.
Hillary Clinton called for closing the so-called “carried interest” loophole that allows millionaire Wall Street executives to pay a lesser percentage of their income tax than regular working Americans. In 2008 she pledged to “ensure that the carried interest earned by some multimillionaire Wall Street managers is recognized for what it is: ordinary income that should be taxed at ordinary income tax rates.” She estimated this could create over four billion dollars a year in new money that could be used for middle class tax relief and new education initiatives. The Obama Administration has also proposed closing this tax loophole.
Reevaluating government breaks to big corporations and ending corporate offshore tax havens.
In 2005, Hillary Clinton called for cracking down on “abusive corporate tax transactions, such as setting up offshore tax havens in places like Bermuda to avoid paying U.S. taxes.” She continued to make the case that it is “simply not fair that as corporate profits have skyrocketed, the percentage of taxes paid by corporations have fallen. It’s time we restored the balance and required corporations to pay their fair share.” The Obama Administration has repeatedly proposed closing these offshore loopholes. Hillary also proposed a new watchdog agency, the Corporate Subsidy Information Service, that would track “every tax subsidy that Congress gives to big corporations” to allow the American people to “know exactly how much each company gets” and “track whether those subsidies actually promote results for the country and not just the company.”
Increasing oversight of complex financial products like derivatives.
In March 2008, Hillary Clinton proposed that financial institutions involved with derivatives be “subject to minimum capital requirements… based on the principle that capital requirements related to risk should be applied to all bank-like institutions that issue credit.” The Dodd Frank Wall Street reform law created new oversight authority over derivatives by the SEC and Consumer Financial Protection Bureau. The House of Representatives has attempted to loosen these regulations, which Hillary called “risky and wrong.”