In what's almost certainly the day's biggest story, Sam Stein at The Huffington Post reports on a conference call co-hosted by Citibank and the Chamber of Commerce to gin up opposition to the Employee Free Choice Act. Why is it such a big story? Because the day before the call, Citibank analyst Deborah Weinswig, had downgraded Wal-Mart stock from "buy" to "hold" based on fears that EFCA would pass. As I reported at the time, that struck many on the Left as a peculiar decision. EFCA was no likelier to pass on Tuesday than it was to pass a month ago. Indeed, its chances had arguably dimmed, as Southern Democrats began voicing concerns about the legislation. The timing seemed to maximize political impact rather than accurately reflect changing market or legislative conditions. Meanwhile, Citibank did not upgrade its recommendations on heavily unionized retailers who would benefit from EFCA, like Safeway. This led many on the Left suspected that Weinswig's call was less about accurately pricing Wal-Mart's stock and more about inducing panic over the Employee Free Choice Act. The market agreed: Wal-Mart's stock rose even as Citibank cut their earning estimate. In most quarters, this was dismissed as a conspiracy theory. At least, it was until yesterday, when Citibank improbably joined with the Chamber of Commerce to host a call opposing the Employee Free Choice Act. During the course of the conversation, the call leaders said that EFCA will "inhibit flexibility," "hamper companies from competing effectively," and prove "cumbersome" for business. The representative of the Chamber of Commerce said that "from the Chamber's perspective, and I would say probably from the whole business communities perspective, there are really no amendments you could make to this bill that would make it acceptable." The moderator on the call? Deborah Weinswig. This is a big deal for two reasons. First, it calls into question the impartiality of Citibank's ratings division. Second, it happened amidst a government-funded bailout of Citibank. This is a moment when you'd expect Citibank to be on its best behavior, both in terms of its political action and its business practices. In fact, they appear to be dispatching their analysts and leveraging their ratings division to oppose a policy that the Obama administration supports.
