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GOP opposition to Lynch was a missed opportunity

The Republicans’ failed tactics against Loretta Lynch reveal the big banks' hold on both parties

April 28, 2015 2:00AM ET

Yesterday Loretta Lynch was sworn in as the nation’s 83rd attorney general. On April 23, the Senate voted to confirm her nomination after obstructing it for almost half a year. While their reasons were baseless and self-defeating, Republican leaders did not avail themselves of an excellent reason to reject her candidacy. That they ignored it speaks to our corrupt politics.

Shortly before confirmation, The New York Times ran with prominent placement an article titled “Republicans in quandary over vote on Loretta Lynch.” What was the dilemma GOP leaders faced? The piece began:

Senate Republicans do not want to be held responsible for rejecting the historic nomination of Loretta E. Lynch, the first African-American woman picked to be attorney general. But they also are in no hurry to see her confirmed because of her defense of President [Barack] Obama’s immigration policies. 

Ms. Lynch is nearing six months in a state of suspended Senate animation, her nomination moving neither forward nor backward but instead becoming a bargaining chip in an unrelated battle, a calculation that carries no small irony given that no Republicans have challenged her credentials, and almost all of them had expressed their enmity for the man she would replace, Attorney General Eric H. Holder Jr.

The article portrayed the Republican opposition to Lynch as baseless. It indicated that the Senate’s consent to her nomination should have been routine:

As the United States attorney for the Eastern District of New York, Ms. Lynch had a formidable reputation as a prosecutor and administrator and had the strong backing of law enforcement and civil rights groups. Some of the most conservative Republicans were expected to oppose her, but her ultimate approval never seemed in doubt.

The article concluded with this telling point:

With the prospect of Hillary Rodham Clinton as the Democratic presidential nominee next year and given the party’s struggle with minority voters, the Senate’s new Republican majority does not want to be remembered for killing the high-profile nomination of a highly qualified black woman.

The Senate Republicans have managed once more to take a position of great power and instead of embarrass Obama, embarrass themselves. Worse, they have made clear again to tens of millions of Americans that the Republican leadership and base treat women and minorities with contempt even when a nominee has a “formidable reputation as a prosecutor and administrator.” Congressional Democrats were long the experts on forming a circular firing squad, much to the pleasure of Republicans, but the GOP seems must have purchased a lease on those patent rights. Every time the GOP professionals announce some new outreach initiative to women and minorities, the party’s elected leaders start blasting away at women and minorities – and mostly shoot themselves instead of their targets.

The Times article hints at but never says that if the Republicans’ stated basis for opposing Lynch’s nomination is absurd and they concede she is well qualified for the position, then the only logical basis for their actions is some combination of racism, sexism and destructive superpartisanship.

Lynch's failure to prosecute HSBC and its officers exemplified a real Obama scandal, the effective end of the rule of law for criminal bankers.

Congressional Republicans have proved spectacularly inept at holding investigative hearings and issuing well-researched committee reports that nail Obama and his team. Darrell Issa became so notorious for these investigative failures that he was replaced by the Republican leadership as a House committee chairman.  

The reason to reject Lynch

God must be a Republican, for he induced Obama to send Senate Republicans a savior — Lynch — in their hour of greatest self-inflicted frustration. She offered Senate Republicans the nearly perfect means of attacking her and embarrassing his administration. 

The reason Lynch was such a godsend to the GOP never appeared in the Times article: HSBC. The biggest bank in Europe and the most disreputable large bank in the world, HSBC was the subject of the most important case Lynch ever handled. It demonstrated that Lynch’s “formidable reputation as a prosecutor” is undeserved, making Republican opposition to her nomination legitimate. More important, her failure to prosecute HSBC and its officers exemplified a real Obama scandal, the effective end of the rule of law for criminal bankers.

Lynch’s sweetheart deal with HSBC, her indefensible reactions to the bank’s failures to comply even with the sweetheart deal and the bank’s continued commission of thousands of felonious transactions after the sweetheart deal offered Republican leaders the ideal circumstances to attack the Obama administration. The Republicans did not need to suddenly develop investigative skills and honest congressional reports. The Democrats, Lynch’s appointee as HSBC’s monitor and the whistleblowers have done all the heavy investigative lifting for the GOP. The ultrashort version is that HSBC and its personnel were caught red-handed having laundered over $1 billion for Mexico's Sinaloa drug cartel — one of the most violent cartels in the world — and helped Sudan and Iran violate U.S. anti-terrorism and anti-genocide sanctions with impunity. This was all documented in a Senate investigation by former Sen. Carl Levin — a Democrat and Congress’ most respected and competent investigator — in a report that the Republicans could have joyfully quoted. The bank was found to have engaged in massive efforts to aid and abet tax fraud. HSBC’s monitor discovered that the bank was not complying with even the sweetheart nonprosecution agreement that Lynch negotiated. She nevertheless failed to prosecute any of the numerous felonies at HSBC outlined in the Levin report. 

Remarkably, the supposedly liberal New York Times and GOP leaders have something in common: Both refused to mention HSBC as a key reason for rejecting Lynch’s nomination. What the GOP’s embarrassingly self-destructive strategy for opposing Lynch proves is that even when the Republicans have the perfect opportunity to embarrass the Obama administration and highlight one of its largest scandals — the failure to prosecute a single bank officer who led the most destructive epidemics of financial fraud in history that caused our Great Recession — the Republicans refused, lest they upset their leading source of political contributions. The approval of the Lynch nomination demonstrates that bipartisanship does exist on Capitol Hill: when it favors the big banks and their lobbyists.

William K. Black is an associate professor of economics and law at the University of Missouri at Kansas City and a distinguished scholar for financial regulation at the University of Minnesota Law School.

The views expressed in this article are the author's own and do not necessarily reflect Al Jazeera America's editorial policy.

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Banks, Politics
Loretta Lynch

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