Keith Rothfus (Pennsylvania’s 12th CD) has been a dependable champion of Wall Street’s political agenda throughout his three terms in Congress. Again and again, he has used the powers of his office to help big banks, payday lenders, securities firms and other large financial companies – and their executives – enrich themselves at the expense of the rest of us.
Those companies and their executives have in turn been massive funders of Rothfus’ political career. In all, he has collected over $2 million in campaign contributions from financial and real estate interests, more than from any other sector of the economy. His top donors in the current election cycle include Federated Investors, Bank of New York Mellon, Wells Fargo, the American Bankers Association, PNC Financial Services, Northwest Mutual, State Street Corp., the American Financial Services Association, Bank of America and Goldman Sachs.
Rothfus played an instrumental role in two of Wall Street’s biggest recent legislative victories. The first, in October 2017, was the passage of a measure (HJ Resolution 111, which he introduced) stripping consumers of the right to join forces and take banks and other financial companies to court over systematic fraud. By doing so, it legitimized the financial industry’s use of take-it-or-leave-it contracts that force consumers to submit any and all disputes to private arbitration firms. This system amounts to a corporate Get out of Jail Free Card, since the cost of legal action generally exceeds the damage suffered by any one person, and the arbitration firm is typically chosen by (and dependent on future business from) the company being complained against.
In May 2018, bank lobbyists sought Rothfus’s assistance again, this time in moving a huge financial deregulation bill across the finish line. Rothfus helped sell the legislation (S 2155) as regulatory relief for small “community banks” – a well-honed Wall Street marketing pitch for bills whose chief beneficiaries, as a rule, are much larger and less sympathetic institutions. The core provision of this bill freed a group of 25 banks with assets of $50-$250 billion from the heightened oversight put in place after the 2008-09 financial crisis. Far from protecting community banks, S 2155 will spur increased bank consolidation by letting a $50 billion institution grow up to five times bigger without attracting any extra regulatory scrutiny – a point acknowledged by industry insiders as soon as the bill passed. Its other unadvertised features included a significant weakening of safeguards against predatory or racially discriminatory lending, especially in rural areas of the country.
S 2155 also incorporated a provision – originally introduced by Rothfus as a stand-alone bill (HR 2121) – lowering the amount of capital that a small group of big banks have to set aside to cover potential losses and reduce the risk of a taxpayer-funded bailout. The two banks in a position to gain the most from this provision turned out to be Bank of New York Mellon and State Street Bank, which had contributed $29,000 and $14,500, respectively, to Rothfus’s reelection.
Since his first run for Congress in 2010, Keith Rothfus has received more than $2 million from contributors associated with financial and real estate companies (see footnote 1). His top 20 career donors include Federated Investors ($123,850), PNC ($75,876), Bank of NY Mellon ($61,600), Wells Fargo ($51,600), McMahon Financial $46,400) and Northwestern Mutual Life Insurance ($40,900). During the current election cycle, his contributors include those companies and the American Bankers Association ($20,000), State Street Bank ($14,500), Ernst & Young ($12,000), Experian ($10,000), the National Association of Insurance & Financial Advisors ($10,000), the American Financial Services Association ($10,000), the Independent Community Bankers of America ($9,000), the Mortgage Bankers Association ($8,000), Bank of America ($8,000), USAA ($7,500), Prudential Financial ($7,500), Massachusetts Mutual Life Insurance ($7,500), MetLife ($7,500), Wells Fargo ($6,900), PricewaterhouseCoopers ($6,500), Goldman Sachs ($6,000), Morgan Stanley ($5,500), and Liberty Mutual ($5,500).
In 2017 and 2018, Americans for Financial Reform (a coalition of more than 200 consumer and other public-interest groups) tracked 38 House floor votes and 36 Financial Services Committee votes – 74 votes altogether – on measures that would make it easier for Wall Street banks and other financial companies to take reckless bets or enrich themselves at the expense of the society as a whole. Keith Rothfus voted for all 74 of those measures, including proposals to:
- Sharply reduce the funding, powers, and political independence of the Consumer Financial Protection Bureau, making it easier for mortgage lenders, payday lenders, and credit card companies etc. to stick people with hidden fees and unexpected charges (HR 10, voted for);
- Repeal the “Volcker Rule,” which bars the big Wall Street banks from playing reckless games with insured deposits and other taxpayer-subsidized funds (HR 10, voted for);
- Roll back consumer credit safeguards for mobile (or manufactured) homes, making it easier to steer borrowers into high-cost loans with excessive fees and interest – in an industry that has long been rife with such abuses (HR 1699, voted for);
- Weaken oversight of the Big 3 credit ratings agencies, Moody’s, Standard & Poors, and Fitch, which made huge sums of money by slapping triple-A ratings on toxic mortgage-backed securities in the run-up to the financial crisis (HR 3911, voted for); and
- Give Wall Street banks and other large financial companies a new way to undo rules they dislike, by requiring the explicit approval of both houses of Congress before any major regulation takes effect. (HR 26, voted for).
Rothfus also supported the Republican tax-cut plan, from which big banks, financial companies and their executives stand to gain hundreds of billions of dollars, with the scandal-ridden Wells Fargo poised to be the leading corporate beneficiary.
All these votes occurred during the 115th Congress. If you’re wondering how a body of elected officials could somehow manage to act on item after item from Wall Street’s legislative wish list while doing next to nothing to address the serious problems on the minds of most Americans (health care, housing, and the rest), Keith Rothfus is your answer – Rothfus and others like him who have built their political lives around the pursuit of campaign donations from big banks, securities firms, payday lenders and other giant financial companies.
On the issues they care about, Keith Rothfus has a long record of ignoring not only the interests but the will of the people he is sworn to represent. The great majority of Americans, across party lines, want to see tougher financial regulation and worry that Wall Street has too much influence over our economy and government. Yet not once in the actions described here has Rep. Rothfus called for stronger rather than weaker regulation of banks, lenders and other Wall Street entities.