Wall Street Reform: SAFE Banking Act Fails

May 10, 2010 - Last Thursday's Senate floor debate on the financial reform bill saw another round of amendments offered and voted on. The most significant vote of the day was the SAFE Banking Act, sponsored by Sherrod Brown (D-OH) and Ted Kaufman (D-DE), a provision that would limit the share of insured deposits, liabilities and leverage any one financial institution can hold. The amendment offered a set of specific size caps, in terms of U.S. gross domestic product and total deposits; Sen. Brown stated that "the six largest U.S. banks now have total assets estimated to be in excess of 63 percent of our GDP."

Despite some bipartisan support, the amendment failed, 33-61. Three Republicans joined 29 Democrats and Independent Bernard Sanders in support, while 21 Democrats and Independent Joe Lieberman joined the rest of the Republican caucus to vote the measure down. Senate Dems voting to not impose limits on bank size received on average 55% more money from the banking industry interests that would be affected by this provision, compared to Senate Dems who voted in support of bank size limits.

The six largest banks that would have been affected by this amendment are, in order of asset size: Bank of America, JPMorgan Chase, Citigroup, Wells Fargo, Goldman Sachs, and Morgan Stanley. Campaign finance contributions from these banks and their employees to current Senators totaled $5,894,844 over the last six years (that's one election cycle per Senator). On average, contributions to Senate Democrats who voted to defeat the measure were $85,496, 70% more than the $50,241 average contributions to those who supported the Brown-Kaufman amendment.

Campaign Contributions (2004-2009) to Current Senators From Bank of America, JPMorgan Chase, Citigroup, Wells Fargo, Goldman Sachs, and Morgan Stanley and Their Employees

Methodology

Campaign contributions data provided by the Center for Responsive Politics' (CRP) OpenSecrets Open Data. The averages calculated exclude Senators who were appointed to office in 2009 and are not campaigning to be elected when their appointed term expires: Sen. Burris (D-IL), Sen. Kaufman (D-DE), and Sen. LeMieux (R-FL). The date range of contributions is: January 1, 2004 - December 31, 2009. Contributions to the Presidential campaigns of Senators are not included.

For the table within the blog post, the sums include contributions from PACs and individuals employed by Bank of America, JPMorgan Chase, Citigroup, Wells Fargo, Goldman Sachs, or Morgan Stanley.

For the view linked from the blog post, the banking industry interest group categories selected for the industry-wide analysis are limited to the CRP industry categories of the six listed banks: Banks and Lending Institutions, Commercial Banks and Bank Holding Companies, and Investment Banking. This view includes all contributions made by contributors in these interest groups, not only the six listed banks.