My congressman, Darin LaHood (IL-18), has chosen regularly to represent the interests of Wall Street against the interests of his own constituents.
For instance, just this past week, he voted along with almost all of his Republican colleagues to rescind a rule established last year by the Department of Labor that made it easier for small businesses to set up retirement-savings programs for their employees (H.J. 66). Helping workers find an inexpensive way to put away some savings for retirement: who would be against that? Wall Street firms who want to charge people more for setting up and administering their retirement accounts.
Rep. LaHood has, in fact, from the very beginning of his congressional career made no secret of his eagerness to serve powerful financial interests against the interests of his constituents. Soon after he was elected (in a special election to fill the seat of resigned-in-disgrace Aaron Schock), one of his first op-eds in the Peoria Journal Star was an explanation of why he opposes the fiduciary rule for investment advisers.
The rule (as yet to be implemented, and delaying or blocking it is a Trump priority) is that investment advisers should place the financial interests of their clients ahead of their own. That is, if the adviser or the adviser’s firm has a financial interest in pushing a particular investment, but that investment would not be so remunerative for a client as some others might be, the adviser will be required to suggest the client invest in one of those others.
People who go to an investment adviser, obviously, have decided they do not know enough about the wisest investment opportunities to make a well-informed decision for themselves. They place themselves in the hands of someone better informed than they are themselves (as I place myself in the hands of my dentist, who knows a lot more about dentistry than I do). And I’m willing to believe that most investment advisers have the well-being of their clients uppermost in their minds.
To assume that all do, however, would, of course, be a mistake. My congressman, I’m disappointed to observe, is especially eager to come to the service of those who do not.
It is perfectly legal for an investment adviser to tell a client to invest in securities that the adviser’s firm has a stake in promoting–no matter the foreseeable prospects for that investment, in fact, even if the adviser knows it to be an inferior investment.
People’s comfort in retirement is at stake, yet this legalized fraud is still available to unscrupulous advisers–or advisers with troubled conscience who work for corrupt firms.
As I said, LaHood announced in April 2016 that he is opposed to the financial interests of his constituents and would rather serve the interests of Wall Street firms that want a free hand in fleecing the Congressman’s constituents.