As she tried to look past the latest controversy over her private email server, Hillary Clinton said in a speech Friday that she wants to “save capitalism for the 21st century” by pushing investors and corporations to focus more on long-term growth than making a quick buck.
RELATED: The New York Times’ Clinton email controversy: A timeline
Some activists had hoped and expected Clinton would present a more robust plan on Wall Street, but instead she took on “quarterly capitalism” — the obsession with share prices and quarterly earnings over real value creation, which Clinton views as dangerous to the economy.
To change the incentives, Clinton proposed raising capital gains taxes on investments held for only short periods of time. The tax on investment earnings would nearly double from their current rate of 20% for investments held less than two years. And the rate for those in the top tax bracket would be set on a sliding scale, with incentives for people who hold their investments longer.
Meanwhile, Clinton said she would change the tax code to eliminate incentives for CEOs to be paid based on short-term bumps in share prices, with the aim of encouraging leaders to plan more strategically for the future.
Clinton also took on what she called “hit and run” shareholders — activist investors who pressure corporations to jack up their share prices or pay more dividends to investors, even if it doesn’t help the company in the long run.
At the same time, Clinton addressed the union-backed push to raise the minimum wage to $15 an hour.
Clinton said she that while she supports the effort in New York City, the latest focal point in the movement, she’s unsure about making the federal minimum wage $15. “I agree with New York’s proposal this week to raise wages for fast food workers to $15 an hour,” she said. “The national minimum wage is a floor and it needs to be raised, but let’s also remember that the cost of living in Manhattan is different than in Little Rock and many other places. So New York or Los Angles or Seattle are right to go higher.”
Clinton spoke for about 35 minutes at New York University’s Stern School of Business, in front of an audience of about 200 policy experts, members of the Manhattan Chamber of Commerce and other friends of the campaign.
While Clinton called for “new, creative, disruptive ideas to save capitalism,” it was not the speech some progressives had hoped for. Many had anticipated that Clinton would use the speech to explain how she would take on the financial sector. But Wall Street was hardly a factor in her remarks. Her only direct mention of regulation was to warn that Republicans would roll back Dodd-Frank, which was passed five years ago, if they regained the White House.
Some liberals were disappointed. “Working to end short-termism on Wall Street will definitely help working families in important way,” said Democracy for America executive director Charles Chamberlain. “But let’s be really clear: The Democratic Party doesn’t want, and the American people don’t need, another Democratic President who tip-toes around Wall Street’s insatiable greed.”
“Today’s speech hits those notes in some ways, but fails to do so in others,” he added. Clinton’s Democratic rivals Bernie Sanders and Martin O’Malley have been much more outspoken on Wall Street reform, calling for criminal penalties against executives who contributed to the Great Recession and demanding that the largest banks be broken up. On Thursday, O’Malley gave a speech on Wall Street reform that he hoped would contrast with Clinton’s and present him as a leader on the issue. RELATED: Martin O’Malley’s early bird strategy Another liberal group, the Progressive Change Campaign Committee, essentially gave Clinton an incomplete. “We look forward to the Clinton campaign’s big speech on systemic reforms, and the American public will look to see if she is willing to challenge Wall Street power,” said Adam Green, the group’s co-founder, suggesting Friday’s speech was not the one he was looking for. Many of the ideas Clinton did lay out Friday already have substantial support in the financial world, as Politico reported, making them safer territory for the former secretary of state to endorse. Clinton’s campaign promises more ideas on Wall Street reform will come later.
Alex Seitz-Wald Recommended
