First they used Kennedy's death to pass 'health care' overhaul, now they plan on using the Goldman Fraud to pass the "Banking overhaul" bill.

http://www.nytimes.com/2010/04/28/business/28bankers.html?src=busln

Politicians like nothing more than a convenient foil, and Democrats locked in a stubborn impasse with Republicans over new rules to govern
Wall Street believe they have found a gold-plated one in Goldman Sachs.

Democrats say the convergence of their push for an overhaul of financial regulation and a prominent federal securities case against the prestigious investment firm is a matter of coincidence, not planning.

But they have seized on emerging details about Goldman’s wheeling and dealing — recounted in a marathon bipartisan questioning of top
executives from the firm on Tuesday during a televised Senate hearing —
to put pressure on Republicans.

“If the disclosures at these hearings are not the final nail that persuades the American people to demand this be done now, I don’t know
what would be,” said Senator Byron Dorgan,
Democrat of North Dakota. “To bet against your clients, to bet against
your country, all for the sake of big profits. The timing is
serendipitous but it should increase the pressure on Republicans.”

Even as current and former Goldman executives defended themselves against charges of pillaging the economy, Democrats forced another
procedural vote on the Wall Street regulatory measure. They knew they
would come up short but were intent on juxtaposing the image of
millionaire bankers parrying suggestions of greed and malfeasance with
Republican determination to at least slow a bill calling for tighter
regulation. Democrats said they would keep calling for votes to make
their point.

“Republicans will have more opportunities to show whose side they are truly on,” said Senator Harry Reid, Democrat of Nevada and the majority leader.

If nothing else, the civil case filed by the Securities and Exchange Commission against Goldman has given Democrats a chance to highlight a cast of
purported villains, embodiments of the forces that led to the financial
crisis and the ensuing deep recession and faces at which the nation’s
angry populist impulses could be directed.

For hour after hour on Tuesday, Democrats and Republicans interrogated Goldman’s mortgage men, including the chief executive, Lloyd C. Blankfein, and Fabrice Tourre, the employee named in the S.E.C. complaint, putting them on the spot
over Wall Street’s questionable conduct at a legislatively propitious
moment.

None of the Goldman executives have been found to have done anything wrong, but some Democrats were ready to place them in the same role
played in past financial crises by high-fliers like Charles Keating, Michael Milken and Ken Lay, all of whom came to personify the excesses of the moment.

The hearings were the culmination of a Democratic strategy to take full advantage of the opportunity created by the S.E.C. civil case.

Top Democrats said it helped to put a face on an economic calamity that is as complicated as a synthetic collateralized debt obligation. But the real impact of the Goldman Sachs inquiry seemed difficult to gauge when it came to Republicans.

While Senate Republicans joined Democrats in pounding on the Goldman executives at the hearing and expressed comparable outrage over what
they described as blatant conflicts of interest in the structuring of
Goldman deals, they confidently trooped over to the Senate floor to
vote again to block the bill.

They accused Democrats of trying to force through a partisan measure, sought to raise new questions about the measure’s reach beyond the
titans of Wall Street and noted that many Democrats had benefited more
from Goldman campaign contributions than Republicans.

Senator Mitch McConnell of Kentucky, the Republican leader, said he did not believe Republicans
would pay a political price for their resistance to the legislation,
even with the Goldman case playing out in the background, as long as
Republicans could make the case that they were trying to achieve a
better end result.

“What happens on Monday or Tuesday versus what happens later is something largely lost on the general public,” he said.

Some Democrats, despite being aghast at Goldman’s evident willingness to bet against investments it was selling to other clients, said it was
in some ways inequitable to single out Goldman when they might have
just been the biggest and best at what became a Wall Street routine.

“They were all doing this,” Senator Claire McCaskill, Democrat of Missouri, said. “This was lemminglike.”

Other Democrats said privately that the party needed to be careful in how far it goes in portraying Goldman Sachs as the chief bad guy in the
financial collapse given the firm’s major presence on Wall Street, as
well as in the world’s financial markets. Some Republicans have
suggested that the Goldman developments are too much of a coincidence,
implying that the S.E.C. lawsuit and Senate hearing were all elements
of an orchestrated effort to provide momentum to the Wall Street
overhaul and help Democrats break the Republican unity against the
measure.

Administration and Congressional officials strongly deny any such coordination and note that the investigative committee headed by
Senator Carl Levin, Democrat of Michigan, has been looking into the underlying causes of the financial crisis for months.

Still, Democrats were not about to let such a prime opportunity pass.

Moments after Republicans blocked debate on the bill for a second time, Senator Dianne Feinstein, Democrat of California, took the Senate floor to note that she had been following the Goldman Sachs hearing.

“Goldman Sachs will have their day in court,” she said. “But the allegations against the firm cry out for greater transparency at giant
Wall Street banks.”