KeNo's Housing and Economic Portal: Saturday May 29 Housing and Economic stories

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Congress members bet on fall in stocks - (finance.yahoo.com) Some members of Congress made risky bets with their own money that U.S. stocks or bonds would fall during the financial crisis, a Wall Street Journal analysis of congressional disclosures shows. Senators have criticized Goldman Sachs Group Inc. for profiting from the housing collapse. And Congress is considering legislation to curb Wall Street risk-taking, including the use of financial instruments known as derivatives and of leverage, or methods that amplify returns. According to The Journal's analysis of congressional disclosures, investment accounts of 13 members of Congress or their spouses show bearish bets made in 2008 via exchange-traded funds—portfolios that trade like stocks and mirror an index. These funds were leveraged; they used derivatives and other techniques to magnify the daily moves of the index they track. There's no evidence the legislators and their spouses used privileged information or failed to follow rules on disclosure. Congressional rules permit lawmakers and their families to invest in—or bet against—publicly held companies they oversee through committee assignments, as well as broader markets or indices. While some made money, others lost. Some of these legislators have publicly criticized practices such as short-selling, or betting on a security to decline. In February, Sen. Johnny Isakson (R., Ga.) argued on the Senate floor that "we don't need those speculating in the marketplace to take unfair advantage of the values of equities that are owned by Americans all over this country for the sake of making a buck on a short sale."

SEIU Head Sets Sights on New Sectors - (online.wsj.com) The newly elected head of the powerful Service Employees International Union pledged to focus more on private-sector organizing, including workers in banking and biotechnology, as well as on gubernatorial elections and mending ties with other unions. Mary Kay Henry, head of the union's health-care division, was elected by the SEIU's board Saturday to succeed Andy Stern, who retired last month after 14 years as president. In her first moves as president of the 1.8-million-member union, Ms. Henry said SEIU would create a $4 million "innovation fund" focused on finding new targets and ways of organizing in the private sector, and would set aside another $4 million for campaigns related to 2010 gubernatorial races in Arizona, California, Connecticut, Illinois, New York, Ohio and Florida, on top of $10 million proposed earlier. An SEIU spokeswoman said the union targeted states where it has an active and growing membership and that the SEIU and its locals spend roughly $250 million a year on organizing. The union said it has organized 22,000 workers since early April, including 5,500 home-care providers in Wisconsin. "We are renewing our union's incredible commitment to organizing," said Ms. Henry, 52 years old. "We are deeply committed to the low-wage economy and changing that." Business groups see more organizing campaigns in which the union uses pressure tactics to get employers to agree to unionization without holding secret ballot elections overseen by the National Labor Relations Board.

Massive bank fraud still unacknowledged - (www.dailybail.com) PBS Video. MASSIVE BANK FRAUD: Bill Moyers With William K. Black (VIDEO & Transcript). On Thursday, April 22, President Barack Obama made the case for increased regulation of the financial industry in a televised speech at Cooper Union in New York City. It was widely billed as President Obama's chance to harness the momentum behind reforming Wall Street and move forward the bills being considered in the House and Senate. Those measures face stiff opposition from most of the Republican Party and an army of lobbyists from Wall Street who have the ear of members of Congress on both sides of the aisle. William K. Black thinks President Obama didn't acknowledge a key component in the financial crisis that the bills before Congress won't address — fraud. A former regulator who helped crack down on massive fraud during the savings and loan crisis in the 1980s, Black tells Bill Moyers on THE JOURNAL that, despite evidence of fraud at the top banks, prosecutions seem far away. "If you go back to the savings and loan debacle, we got more than a thousand felony convictions of the elite. These are not, you know, tellers or something. We today have zero convictions, zero indictments, zero arrests of any of the elite, non-prime lenders that, through their fraud, drove this crisis."

Special Interests Continue Federal Lobbying Blitz, New Reports Indicate - (www.opensecrets.org) As President Barack Obama works with the Democratic Congress to advance his ambitious legislative priorities, lobbying efforts by special interest groups continue unabated. Lobbying reports for the first three months of 2010 were due to the Clerk of the House and Secretary of the Senate by midnight last night, and a preliminary Center for Responsive Politics analysis of these reports shows many major players continuing to shell out big dollars on their lobbying operations. The U.S. Chamber of Commerce, a leading opponent of the Democrats' plans for health care reform, Wall Street reform, climate change and unionization efforts, once again this quarter ranked as the top dog on K Street. According to a Center for Responsive Politics tally, the Chamber and its subsidiaries spent nearly $30.9 million on federal, state and grassroots lobbying activities. This is nearly double what it spent during the first quarter of 2009 -- although it represents about a 60 percent decrease over the whopping $79 million it spent during the fourth quarter of 2009. No other company, trade association, union or other group reported spending a figure in that ballpark, although the Chamber does voluntarily include state-level and grassroots lobbying data that most other companies and organizations do not. Other high-profile entities, such as the American Beverage Association and investment bank Goldman Sachs, have also increased their lobbying considerably this past quarter compared to the same time period last year. Here is an analysis of some of the companies and groups most active in high-profile legislative fights:

Overthrow a Sign of Tea-Party Clout - (online.wsj.com) Republican officials sought to unify the party after Saturday's tea-party driven ouster of three-term Utah Sen. Robert Bennett. Mr. Bennett became the year's first victim of the anti-incumbent fervor sweeping through the Republican Party when he lost his bid for his party's nomination at a state GOP convention here. GOP activists blasted him as a Washington insider who had lost touch with Utah's conservative ideals and will instead nominate a tea party-backed populist candidate who promises to reduce the scope of the federal government. The GOP candidate hasn't yet been chosen, but it will be one of Mr. Bennett's two challengers, businessman Tim Bridgewater and lawyer Mike Lee, both favored by the tea party and who will face off in a June 22 primary. The winner will be favored to win the general election in this heavily Republican state.