JKHC FORUM

Sunday, September 25, 2016

Questions for Hillary Clinton & Donald Trump respectively - Guardian

For Donald Trump

How can you be trusted with the nuclear codes?

A symbolic question, but one that goes to the heart of concerns about Trump’s suitability for the job of commander-in-chief. He has made a number of erratic comments appearing to suggest a cavalier approach to nuclear proliferation; he has also threatened to undermine both Nato and a longstanding commitment to non-nuclear allies in Asia. Combining all this with a general belligerence that terrifies even generals, Trump has much to do to reassure voters he is not a dangerous loose canon.

Did you support US intervention in Iraq and Libya?

Trump has tried to have his cake and eat it on the subject of Middle East policy, attacking Clinton for backing regime change in Iraq and Libya while implying he was opposed to both wars at the time. But though this real estate investor’s foreign policy views were not then widely sought out, there is a plenty of evidence to suggest he kept any opposition very quiet. Asked if he backed the invasion of Iraq, he said: “I guess so.”

Why would Mexico pay for you to build a wall?

The flagship policy of building a physical wall on the southern border is frequently embellished with a boast that Trump would make sure Mexico paid for its construction. A recent meeting with the Mexican president, however, made clear that this is highly unlikely. Trump appeared to mislead supporters almost immediately afterward and continues to ignore evidence that Mexican net migration into the US has dropped to near zero in recent years. The mechanics of his deportation policy are even vaguer.

Is there anyone you regret offending?

An open question that could lead Trump into uncharted territory. For over a year, the Republican nominee has outraged Muslims, African Americans, women, Latinos and disabled people with a series of ever-more outrageous comments. Any attempt to hold him to account for offensive language was dismissed as mere political correctness. Attacking the family of a Muslim war hero after the Democratic convention finally seemed to damage Trump in the polls, though, and prompted a half-apology. Who else will he say sorry to?

What evidence do you have against climate change?

Like many Republicans, Trump has repeatedly suggested that action to prevent man-made climate change is unnecessary because he does not “believe” it is real. He is even threatening to pull the US out of the Paris climate accord. Yet in the face of overwhelming evidence from world scientists, surely the onus is now on skeptics to prove their claims with facts and numbers of their own. What proof does Trump have that climate change is a “hoax”?

Trump is doing well if…

… he can convince viewers at home that he is not crazy. This low bar for success is a big cause for concern among Democrats. Trump has come a long way despite erratic and unpleasant behaviour on a unprecedented scale in modern politics. If he can walk offstage with people thinking he is not quite as erratic rude as they thought, then it could make all the difference.

For Hillary Clinton :-

What single policy should your campaign be known for?

Harder than it sounds, or should be, this question gets at a weakness which many critics feels lies at the heart of the campaign. Instead of one signature issue, Clinton has dozens of detailed policies on a host of subjects. It may make her a great president one day, but for now voters struggle to understand what slogans such as “stronger together” mean in practice. If Clinton were forced to pick one concrete thing for viewers to remember her for, what would it be?

Do you believe in globalisation?

Over many years in public life, the former secretary of state has understandably embraced an evolving set of economic positions. But few have come further than Clinton on the subject of free trade deals and the damage they may or may not have done to American manufacturing. She says she opposes the Trans-Pacific Partnership now proposed by Obama, but is it a principled opposition or a mere pragmatic response to Trump? Are there limits to the benefits of globalisation for US workers?

How would your counter-terrorism policy differ from Obama’s?

In the face of continued terrorist attacks, the issue of “defending America” will be top of Monday’s agenda. Yet Clinton risks being caught between defending the legacy of an Obama administration in which she served and acknowledging that not everything is working out well right now. How would she defeat Islamic State? Would she be more or less hawkish in Iraq and Afghanistan? If nothing changes, then Trump may be able to pin her to a range of foreign policy failures.

Why are you so secretive?

From emails to pneumonia, Clinton has repeatedly got herself into trouble by going out of her way to hide information from the public. The obvious question is: what does she have to hide? The usual explanation is that Clinton has been on the receiving end of so many smears over the years that she has learned to be cautious, but this should also teach her to be wary of cover-ups. Why should someone who ignores medical advice to rest, or legal advice to keep email on government servers, be trusted to take wise decisions in office?

How would you reduce income inequality?

Supporters would argue that Clinton has provided many answers to this question: from infrastructure spending and a jobs program to minimum wage increases and taxing the rich. Yet many still wonder if a campaign so heavily funded by America’s rich and powerful really understands or is committed to helping its middle class. Her answers may be more nuanced than Trump’s crude protectionism, but they need to cut through with voters if she is to blunt his appeal in the rust belt.

Clinton is doing well if…

… Americans finish the debate with a clearer sense of what she stands for. Increasingly, the campaign has become defined by what it stands against – principally Donald Trump. While this is highly effective at motivating Democrats, it remains to be seen if this is enough to win over independent voters. Clinton needs to show them, not tell them, that she is on their side.

Saturday, September 24, 2016

Trump got right questions but wrong answers - Telegraph

In a rather autumnal new interview in Vanity Fair, Barack Obama reflects on his soon-to-be relinquished presidency. The subject of Syria, he reveals, “haunts me constantly”. “Was there something,” he asks himself, “we hadn’t thought of?” But he consoles himself by saying: “I don’t want ever to be a President who is comfortable and at ease with killing people.”

One must be glad he does not want to be that sort of President, but his formulation does not really deal with the issue. The problem of Syria is about other people killings hundreds of thousands of people, not about how the President of the United States feels personally about ordering deaths. The sad fact is that Mr Obama’s self-preoccupied conscience (“There’s a writer’s sensibility in me”) helped create a vacuum in world power. In Syria, it made it easier for the civil war and the mass killings to take place.

Thanks to his passivity, the Russians have now arrived. Kept at bay in the Middle East since Nixon and Kissinger pushed them out, they are back. They are so contemptuous of the Western-dominated world order that this week they bombed an international aid convoy on the outskirts of Aleppo, killing more than 20 people. They are confident, almost certainly rightly, that they will get away with it. What is over-flatteringly called “the international community”, expressing itself through the United Nations this week, has probably never been weaker since 1945.

So Russia’s behaviour ought to make any foreign affairs part of the first television election debate between Hillary Clinton and Donald Trump on Monday pretty easy. As a former Secretary of State, Mrs Clinton knows how the rules-based international order works. She shares Mr Obama’s enlightened views but is tougher than he is on “bad actors”. Mr Trump, on the other hand, knows nothing about such matters and has no expert entourage. He seems to admire Vladimir Putin as just the sort of stripped-to-the-waist Action Man he can relate to. The world would seem to be safer with Hillary.

There is another dimension, though – a way of thinking about global security which goes beyond conventional considerations of alliances, international organisations and the balance of power. Theresa May expressed some of it in her speech in New York this week. Leaders should not forget, she said, “the people we represent back at home” and the safety they require. The mass movement of people has doubled globally in 10 years. It is not only a social and economic issue, but also a security one. The right of a country to control its borders is – or should be – part of its basic guarantee to its citizens. Mr Trump is on about the same thing, without any of Mrs May’s polite restraint.

A week ago, there was an explosion in New York which injured nearly 30 people. The City’s mayor, Bill de Blasio, described it as “an intentional act”, but could not bring himself to commit to it being terrorism or trace the likely Islamist origin of the intention. Ahmad Khan Rahani, an Afghan émigré with an admiration for Osama bin Laden, was arrested and charged. Mr de Blasio declared that “militant violence” was “vanishingly rare”, although roughly 400 people born abroad have been convicted of terror-related offences in the United States since September 11 2001. Jointly with the Mayor of Paris and Sadiq Khan, the Mayor of London, he wrote a perky piece in the New York Times about how their great cities should not have any restraints imposed on their openness and diversity. In a separate interview, in the Evening Standard, Sadiq Khan told Londoners to accept that terrorist threat was “part and parcel of life in a big city”. It seemed a funny way to put it. Most big city-dwellers would surely see it as part and parcel of death, and as the greatest single current menace to openness, diversity and, indeed, civilisation. Mr Khan might as well have resurrected that notorious Seventies phrase about Northern Ireland – “an acceptable level of violence”.

Donald Trump boasted that he had spotted and announced earlier than any reporter that the New York attack (and other ones over that weekend) was a terrorist one. He taps into public contempt for the sheer unrealism of leaders who refuse to identify what is happening, and he relates it to immigration. It is important, he says, that when America admits new entrants, they should not be people who hate the place.

However improvised or silly some of his remedies for this problem, he is surely right. Countries that admit significant numbers of deadly enemies cannot remain free countries for long. He is right, too, that a political culture which cannot face this fact is weak or sick. Mrs Clinton – though not as bad an offender as President Obama, who has never even used the phrase “Islamist terrorism” – is on the weaker side of this argument.

This is a classic example of the split, which everyone now talks about, between ruling elites and people in general. Every week, often almost every day, in the part of south-east England where we live, the local BBC News shows film from the migrant camps in France. Recently there has been increasing violence, including attacks on lorries entering the Channel Tunnel. However much sympathy one feels for the plight of refugees, it is hard not to be disgusted by such scenes. No one with a good reason for wanting to live in Britain would wish to injure lorry drivers heading there. Yet our official culture of global human rights seems to direct more hostility towards indigenous people who resent such attacks than to the attackers themselves. Such resentment at the authorities, who don’t understand and even disapprove, helped the Brexit vote here. It will surely help the Trump vote in America.

Another effect of the threat of extremism is to change security policy. Nearly 10 years ago, at a meeting of the think tank Policy Exchange, I heard someone say that, in the modern environment, who is the Chief Constable of West Yorkshire might matter as much as who is First Sea Lord. This becomes truer each year. The combination of the mass movement of people, the global reach of the internet and the presence, in Britain, of significant numbers of Muslim extremists makes the police and the Border Force and intelligence services as much in the front line as any expeditionary force of old. Similar problems affect most other Western countries.

Just now, one feels quite glad not to be an American voter. The choice between a possibly ill, somewhat tainted establishment figure of the 20th century on the one hand, and a brash, blowhard egomaniac on the other would be highly unwelcome. But media hostility over here to Mr Trump is blinding us to why he has a chance. Over global and domestic security, as over economics, the people in charge of the West are not impressing voters, so they incline to look elsewhere.

In that Vanity Fair interview, Mr Obama puts down Mr Trump as “a phenomenon of an expression of certain fears”. He is not all wrong, but he does not ask why those fears have arisen, let alone whether some of them might be well founded. So far, I gather, Mrs May’s people have few links with the Trump camp. It might be time to forge some.

Marriott Buys Starwood, Becoming the Biggest Hotel Chain in the World - TIME Business

Marriott Buys Starwood, Becoming the Biggest Hotel Chain in the World

Posted: 23 Sep 2016 06:23 AM PDT

(NEW YORK) — Several of the best-known names in travel are now united in one hotel company.
Marriott International closed Friday morning on its $13 billion acquisition of Starwood Hotels & Resorts Worldwide, bringing together its Marriott, Courtyard and Ritz Carlton brands with Starwood’s Sheraton, Westin, W and St. Regis properties.
In total, 30 hotel brands now fall under the Marriott umbrella to create the largest hotel chain in the world with more than 5,700 properties and 1.1 million rooms in more than 110 countries. That’s more than 1 out of every 15 hotel rooms around the globe.

Marriott now eclipses Hilton Worldwide’s 773,000 rooms and the 766,000 that are part of the Intercontinental Hotels Group family, according to STR, a firm that tracks hotel data.
“We’ve got an ability to offer just that much more choice. A choice in locations, a choice in the kind of hotel, a choice in the amount a customer needs to spend,” Marriott CEO Arne Sorenson told The Associated Press in an interview Thursday.
Starwood’s guest loyalty program — Starwood Preferred Guest — was also a “central, strategic rationale for the transaction,” Sorenson said. The program’s members are deeply loyal to it, have generally higher incomes and tend to spend many nights on the road.
Starting Friday, members of Starwood and Marriott’s two loyalty programs will be able to link their accounts together. Gold elite members in one program will get gold status in the other. Platinum elite members will get platinum in the other. Marriott silver members will see Starwood’s lowest category, Preferred Plus.
Each Starwood point will be worth three Marriott Rewards points.
Starwood put itself up for sale in April 2015. The Stamford, Connecticut, company had struggled to grow as fast as its rivals, particularly in “limited service hotels,” which are smaller properties which don’t have restaurants or banquet halls. They are often located on the side of the highway, near airports or in suburban office parks.
To get Starwood, Marriott had to outbid China’s Anbang Insurance Group. U.S. and European anti-trust regulators were quick to approve the sale but the Chinese government hesitated, delaying the sale by months.
“We may have been a little too optimistic about how fast we could get this thing closed,” Sorenson said Thursday.
Marriott and Starwood — like other hotel chains — own very few individual hotels. Instead they manage or franchise their brands to hundreds of individual owners, often real estate development companies. Those individual hotel owners are responsible for setting nightly room rates. It isn’t uncommon for a developer to own a Marriott, Hilton, Hyatt and Sheraton in the same city.
The purchase gives Marriott more leverage with corporate travel departments who often look for one giant chain to house all of their employees. It also gives Marriott more power over Expedia and Priceline, the two giant online travel agencies that sell rooms on behalf of hotel companies in exchange for a commission. The hotel industry has spent the last year trying to get travelers to book directly with them instead of the travel agencies to avoid paying those fees.
There are still many details to work out.
Marriott has thrived as an “asset light” company, owning a handful of hotels. Starwood has been selling off properties, while singing long-term management agreements for those same hotels. As of June 30, it still owned 23 properties. Sorenson said he believes there is a strong market to continue selling off many of those iconic hotels.
“There is always a market for the St. Regis in New York,” he said, adding that other assets in the portfolio have comparable stature. “In great global cities, real estate like that always has a value.”
The new company will keep Marriott’s Bethesda, Maryland headquarters but hasn’t announced if it will keep any presence at Starwood’s Connecticut or New York offices.
Then there are the 30 brands. Some have performed better than others but Sorenson said all of them will probably survive the merger.
“I think so. Every one of them has hotels in them,” he noted.
For now, Starwood and Marriott will keep separate loyalty programs. Starwood has a credit card deal with American Express as well as close partnerships with Delta Air Lines and Uber. Marriott has a much larger program with partnerships with Chase and United Airlines.
“Nothing changes immediately. We have to see how those partnerships evolve,” Sorenson said.
Gary Leff, who writes about points and miles at ViewFromTheWing.com, called the three-to-one exchange rate of Starwood points to Marriott points “just right.”
“It’s one of the many reasonable and positive steps that Marriott has taken along the way as it acquires Starwood,” Leff said. “But there’s a whole lot still to happen between now and the programs actually being combined.”

Professor who correctly named all new US president since 1984 said Trump will win - Washington Post

Nobody knows for certain who will win on Nov. 8 -- but one man is pretty sure: Professor Allan Lichtman, who has correctly predicted every presidential election since 1984.

When we sat down in May, he explained how he comes to a decision. Lichtman's prediction isn't based on horse-race polls, shifting demographics or his own political opinions. Rather, he uses a system of true/false statements he calls the "Keys to the White House" to determine his predicted winner.

And this year, he says, Donald Trump is the favorite to win.

The keys, which are explained in depth in Lichtman's book "Predicting the Next President: The Keys to the White House 2016" are:

Party Mandate: After the midterm elections, the incumbent party holds more seats in the U.S. House of Representatives than after the previous midterm elections.

Contest: There is no serious contest for the incumbent party nomination.

Incumbency: The incumbent party candidate is the sitting president.

Third party: There is no significant third party or independent campaign.

Short-term economy: The economy is not in recession during the election campaign.

Long-term economy: Real per capita economic growth during the term equals or exceeds mean growth during the previous two terms.

Policy change: The incumbent administration effects major changes in national policy.

Social unrest: There is no sustained social unrest during the term.

Scandal: The incumbent administration is untainted by major scandal.

Foreign/military failure: The incumbent administration suffers no major failure in foreign or military affairs.

Foreign/military success: The incumbent administration achieves a major success in foreign or military affairs.

Incumbent charisma: The incumbent party candidate is charismatic or a national hero.

Challenger charisma: The challenging party candidate is not charismatic or a national hero.

Lichtman, a distinguished professor of history at American University, sat down with The Fix this week to reveal who he thinks will win in November and why 2016 was the most difficult election to predict yet. Our conversation has been lightly edited for length and clarity.

THE FIX: Can you tell me about the keys, and how you use them to evaluate the election from the point where -- I assume it's very murky a year or two out, and they start to crystallize over the course of the election.

LICHTMAN: "The Keys to the White House" is a historically based prediction system. I derived the system by looking at every American presidential election from 1860 to 1980, and have since used the system to correctly predict the outcomes of all eight American presidential elections from 1984 to 2012.

The keys are 13 true/false questions, where an answer of "true" always favors the reelection of the party holding the White House, in this case the Democrats. And the keys are phrased to reflect the basic theory that elections are primarily judgments on the performance of the party holding the White House. And if six or more of the 13 keys are false -- that is, they go against the party in power -- they lose. If fewer than six are false, the party in power gets four more years.

So people who hear just the surface-level argument there might say, well, President Obama has a 58 percent approval rating, doesn't that mean the Democrats are a shoo-in? Why is that wrong?

It absolutely does not mean the Democrats are a shoo-in. First of all, one of my keys is whether or not the sitting president is running for reelection, and right away, they are down that key. Another one of my keys is whether or not the candidate of the White House party is, like Obama was in 2008, charismatic. Hillary Clinton doesn't fit the bill.

The keys have nothing to do with presidential approval polls or horse-race polls, with one exception, and that is to assess the possibility of a significant third-party campaign.

What about Donald Trump on the other side? He's not affiliated with the sitting party, but has his campaign been an enigma in terms of your ability to assess this election?

Donald Trump has made this the most difficult election to assess since 1984. We have never before seen a candidate like Donald Trump, and Donald Trump may well break patterns of history that have held since 1860.

We've never before seen a candidate who's spent his life enriching himself at the expense of others. He's the first candidate in our history to be a serial fabricator, making up things as he goes along. Even when he tells the truth, such as, "Barack Obama really was born in the U.S.," he adds two lines, that Hillary Clinton started the birther movement, and that he finished it, even though when Barack Obama put out his birth certificate, he didn't believe it. We've never had a candidate before who not just once, but twice in a thinly disguised way, has incited violence against an opponent. We've never had a candidate before who's invited a hostile foreign power to meddle in American elections. We've never had a candidate before who's threatened to start a war by blowing ships out of the water in the Persian Gulf if they come too close to us. We've never had a candidate before who has embraced as a role model a murderous, hostile foreign dictator. Given all of these exceptions that Donald Trump represents, he may well shatter patterns of history that have held for more than 150 years, lose this election even if the historical circumstances favor it.

seven weeks out from the election today. Who do you predict will win in November?

Based on the 13 keys, it would predict a Donald Trump victory. Remember, six keys and you're out, and right now the Democrats are out -- for sure -- five keys.

Key 1 is the party mandate -- how well they did in the midterms. They got crushed.

Key number 3 is, the sitting president is not running.

Key number 7, no major policy change in Obama's second term like the Affordable Care Act.

Key number 11, no major smashing foreign policy success.

And Key number 12, Hillary Clinton is not a Franklin Roosevelt.

One more key and the Democrats are down, and we have the Gary Johnson Key. One of my keys would be that the party in power gets a "false" if a third-party candidate is anticipated to get 5 percent of the vote or more. In his highest polling, Gary Johnson is at about 12 to 14 percent. My rule is that you cut it in half. That would mean that he gets six to seven, and that would be the sixth and final key against the Democrats.

So very, very narrowly, the keys point to a Trump victory. But I would say, more to the point, they point to a generic Republican victory, because I believe that given the unprecedented nature of the Trump candidacy and Trump himself, he could defy all odds and lose even though the verdict of history is in his favor. So this would also suggest, you know, the possibility this election could go either way. Nobody should be complacent, no matter who you're for, you gotta get out and vote.

Do you think the fact that Trump is not a traditional Republican -- certainly not an establishment Republican, from a rhetorical or policy perspective -- contributes to that uncertainty over where he fits in with the standard methodology for evaluating the Keys?

I think the fact that he's a bit of a maverick, and nobody knows where he stands on policy, because he's constantly shifting. I defy anyone to say what his immigration policy is, what his policy is on banning Muslims, or whoever, from entering the United States, that's certainly a factor. But it's more his history in Trump University, the Trump Institute, his bankruptcies, the charitable foundation, of enriching himself at the expense of others, and all of the lies and dangerous things he's said in this campaign, that could make him a precedent-shattering candidate.

It's interesting, I don't use the polls, as I've just explained, but the polls have very recently tightened. Clinton is less ahead than she was before, but it's not because Trump is rising, it's because Clinton is falling. He's still around 39 percent in the polls. You can't win if you can't crack 40 percent.

As people realize the choice is not Gary Johnson, the only choice is between Trump and Clinton, those Gary Johnson supporters may move away from Johnson and toward Clinton, particularly those millennials. And, you know, I've seen this movie before. My first vote was in 1968, when I was the equivalent of a millennial, and lots of my friends, very liberal, wouldn't vote for Hubert Humphrey because he was part of the Democratic establishment, and guess what? They elected Richard Nixon.

And, of course, as I have said for over 30 years, predictions are not endorsements. My prediction is based off a scientific system. It does not necessarily represent, in any way, shape or form, an Allan Lichtman or American University endorsement of any candidate. And of course, as a successful forecaster, I've predicted in almost equal measure both Republican and Democratic victories.

Washington Post

Friday, September 23, 2016

Fortune’s 40 Under 40 List Just Came Out—And Here are the Top 10 - Fortune

Fortune’s 40 Under 40 List Just Came Out—And Here are the Top 10

Posted: 22 Sep 2016 10:07 AM PDT

Fortune, a Time Inc. publication, released on Thursday its latest 40 Under 40 list: an annual ranking of the 40 most influential business people less than 40 years old.
The list includes a mix of entrepreneurs, CEOs, creatives and politicos. Fortune said it ranks people based on power, influence and success, and the list cannot contain repeats from the year before.
Brendan Bechtel tops the list as the CEO of the Bechtel Group, a construction and engineering company, while Chairman and Executive Director of CEFC China Energy Ye Jianming and Hillary Clinton senior policy advisor Jake Sullivan follow in the second and third spots, respectively.

The list has 16 women this year (up from 14 last year), including Bozoma St. John, head of consumer marketing for Apple Music and iTunes, and Payal Kadakia, CEO and co-founer of Classpass. Big names on the list include James Corden, Lin-Manuel Miranda, Jake Sullivan and Marie Kondo..
Here are the top 10 under 40:

And you can see the full list at Fortune

Wells Fargo CEO Apologizes for Fake Accounts and ‘Unethical Sales Practices’ - TIME

Wells Fargo CEO Apologizes for Fake Accounts and ‘Unethical Sales Practices’

Posted: 20 Sep 2016 08:08 AM PDT

(WASHINGTON) — Wells Fargo & Co’s chief executive officer told a Senate panel on Tuesday that customers who had bogus accounts opened in their name will be made whole and compensated for any damage to their credit rating, but some Democratic senators called for his resignation.
Under fire, CEO John Stumpf told the Senate Banking Committee he has told his managers to do “whatever it takes” to make customers whole, refunding fees or compensating them for damage to their credit ratings.
Asked if he would set aside mandatory arbitration agreements that prohibit clients from suing Wells Fargo, he declined to commit to that. The Consumer Finance Protection Bureau has proposed a ban on mandatory arbitration clauses that prohibit class-action lawsuits.

Democratic Senators Sherrod Brown of Ohio and Elizabeth Warren of Massachusetts called for Stumpf to resign, with Warren saying Stumpf should give back his salary and be criminally investigated.
The bank’s board of directors is examining what action it should take against company executives, Stumpf told the committee.
“I accept full responsibility for all unethical sales practices,” Stumpf said, adding later, “I apologize to all of the American people and our customers, and I will make it right.”
Earlier this month, the lender agreed to pay $190 million in penalties and customer payouts to settle a case in which bank employees created credit, savings and other accounts without customer knowledge.
The revelations are a severe hit to Wells Fargo’s reputation. During the financial crisis, the bank trumpeted being a conservative bank in contrast with its rivals.
Of the $190 million in the settlement, only $5 million will directly compensate customers, many of whom might have only paid a small fee on unwanted accounts.
But lawmakers said phony bank accounts might have hurt customer credit ratings, potentially increasing the cost of a mortgage or car loan. New credit card applications and consumer borrowing trends can weight on an individual’s credit report.
“STUNNED”
Thomas Curry, the Comptroller of the Currency, said in prepared testimony for the committee that his agency is considering action against individual Wells Fargo executives who may have violated laws or regulations or engaged in “unsafe or unsound practices, or breach(ed) fiduciary duty.”
Brown, the senior Democrat on the Senate panel, criticized the bank for exploiting customers and for its slow response in controlling the abuse.
“I was stunned when I learned about the breadth and duration of this fraud,” he said in his opening remarks.
Wells Fargo has acknowledged bank employees “inappropriately opened” the customer accounts over five years, and that about 5,300 employees were fired in that time.
Former bank employees have said they were under intense pressure to add accounts for each bank customer.
Abuses were found as early as 2011, Stumpf said, but bank executives only realized the scale of the problem early last year.
At that time, Stumpf said, bank executives came to recognize how a pattern of creating phony accounts could be used to boost unwarranted fees.
“It never dawned on us that there could be a cycle,” the CEO said.
“It just sort of begs the issue of where was management,” Brown said.
Brown said employees were caught “forging signatures, and stealing identities, Social Security numbers, and customers’ hard-earned cash, so as to hang on to their low-paying jobs and make money for the high-paying executives at Wells Fargo.”
Wells Fargo shares rose 1 percent in early-afternoon trading at $46.49.
Senator Jeff Merkley, an Oregon Democrat, has asked the Securities and Exchange Commission to investigate whether Wells Fargo violated internal controls required under the Sarbanes-Oxley Act for financial disclosures and corporate accounting.
The U.S. Attorney’s Offices in Manhattan and in San Francisco are investigating Wells Fargo, a person familiar with the matter said last week.
“TOO BIG TO MANAGE?”
While Democratic lawmakers like Warren were the most outspoken in their attacks, Republicans also grilled Stumpf.
Louisiana Senator David Vitter pressed the CEO on how customer fraud could persist for years and thousands of employees could be fired before the head of the bank got involved.
“Why isn’t this crystal clear proof that an entity as big as Wells is not only too big to fail but it’s too big to manage and too big to regulate?” Vitter asked.
Stumpf said he had considered the question, adding that the widespread abuse was “a problem of focus and not of size.”
Stumpf appeared before the congressional panel with a bandaged right hand. He suffered an injury playing with his grandchildren, according to the bank.
Democratic presidential candidate Hillary Clinton, in a letter to bank customers released on Tuesday, said Stumpf “owes all of you a clear explanation as to how this happened under his watch.” (Reporting by Patrick Rucker in Washington and Dan Freed in New York; Writing by Nick Zieminski; Editing by Jeffrey Benkoe)