Tag Archives: federal regulations

The Government Regulations They Love To Hate

The Republicans have catch phrases which have been very handy for their purposes for the last forty years, “burdensome regulations,” are among them. Rarely do they want to identify upon whom the burden rests. Often they are fond of calling the regulations “job killing.”  Nearly always the “regulations” are amorphous, and highly generalized.

Let’s get specific.  Senator Rob Portman will be introducing a bill which, in its present form, would limit the ability of federal agencies to promulgate rules until every last lawsuit against them is completely litigated. In other words, NEVER.  So, what nefarious regulations would people like to have eliminated?

How about eliminating the regulations associated with the Clean Water Act?  One regulation has already fallen — the one limiting toxic sludge emptied into freshwater.  Is this going to make drinking water any safer? Will this encourage the development of tourism based activities in coal country to diversify their economy by adding more hunting and fishing opportunities?  Will elimination of these rules make the drinking water in Flint, MI and other American cities safer for children, and adults?  Do we really want to go back to the not-so-good old days when the Cuyahoga River caught fire in Cleveland, OH?

Or perhaps people would like rules associated with the Clean Air Act eliminated?  What’s wrong with breathing a little smog — other than creating public health issues like an increase in the incidence of asthma? Respiratory diseases? Lung cancer? What’s wrong with creating a country of people walking around with face masks as they do in Beijing?

How about eliminating consumer protection regulations?  Gee, what could go wrong, other than a replication of Wells-Fargo’s egregious practice of opening accounts people didn’t know about and then charging fees on those accounts?  Other than predatory lenders charging unimaginable rates for pay day loans to working people, and even members of the US Armed Forces?  Other than mortgage servicers failing to notify customers who held their mortgages and failing to properly record documents with local governments? Other than obviously dangerous products being available for sale to unwitting customers, customers without the ability to check online to see if products for infants, children, and others are safe and free of deadly defects?  Other than allowing financial advisers being able to tell retirees to purchase financial products which benefit the adviser far more than they would benefit the retirees?  Other than making it easier for the Wolves on Wall Street to indulge in Casino play with investment funds?  Were these the “burdensome” rules of which we wish to be relieved?

It’s interesting, that Republicans are only too pleased to speak of those regulatory burdens in highly generalized terms, but when brought down to cases, they tend to sputter that “No, it’s not Those” regulations of which they speak.

Who is in favor of providing federal funds to schools that allow bullying and discriminatory behaviors in their buildings? Who is in favor of making it more difficult to determine if lending institutions are cheating their customers?  Who is in favor of dirty air and filthy streams?  Who is in favor of making it more likely that food sold to the public won’t be properly inspected? Let’s guess it’s NOT the average American member of the public at large.

Someone is in favor of removing these, and other obstacles, to free wheeling unrestrained and unregulated corporate practices, and in this Congress they are finding significant support.

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Filed under Economy, financial regulation, Politics

S. 3468: It’s Baaack…and shouldn’t be

Heads Up!  They’re back, againS. 3468 is yet another attempt by the financialists and related banking lobbyists to hamstring efforts to regulate the financial services sector.   It’s not like these interests have ever given up their campaign to revert to Business As Usual  such that the Wall Street Wizards can become yet another font of ill advised, incomprehensible, albeit highly profitable synthetic or otherwise manufactured financial products — You know, things like those adorable synthetic CDO’s which flooded the financial market with valueless toxic paper.

Here’s the CRS summary of the bill submitted by Senator Rob Portman (R-OH) on behalf of the banking sector:

Independent Agency Regulatory Analysis Act of 2012 – Authorizes the President to require an independent regulatory agency to: (1) comply, to the extent permitted by law, with regulatory analysis requirements applicable to other federal agencies; (2) provide the Administrator of the Office of Information and Regulatory Affairs with an assessment of the costs and benefits of a proposed or final significant rule (i.e., a rule that is likely to have an annual effect on the economy of $100 million or more and is likely to adversely affect sectors of the economy in a material way) and an assessment of costs and benefits of alternatives to the rule; and (3) submit to the Administrator for review any proposed or final significant rule.

Prohibits judicial review of the compliance or noncompliance of an independent regulatory agency with the requirements of this Act.

Translation: If any of the financial regulatory agencies, like the SEC, the OCC, the FDIC, or the CFTC wants to approve regulations which might have a “significant effect” on some bank’s bottom line, then the agency would have to present a “cost – benefit analysis,” and submit the rule for administrative (read executive branch) review.

There are some very cogent reason to be extremely skeptical about this bill.

#1.  It dramatically changes the relationship between the administration (executive branch) and the independent financial regulators.   The SEC, et. al. are supposed to be independent of the executive branch, which is why their leadership is subject to confirmation.  To require that the agencies present their proposed rules for executive approval inserts presidential politics directly into the rule making process.

Those who find the diminution of regulatory oversight disturbing will not be pleased with this proposal. Nor will those who decry the transference of yet more power to the executive branch.   There’s nothing here for either end of the political and ideological spectrum.

#2.  It invites endless litigation.  S. 3468 could be alternately named the Wall Street Attorneys’ Full Employment Act.  For those of us who believe that the interminable foot-dragging on CFTC regulations of the derivatives market has gone on long enough, this is entirely too much, [CFTC law] the Portman bill merely serves to add yet another bureaucratic roadblock before regulations can be finalized.  [Lieberman/Collins pdf]

#3. It prevents agencies from acting in a timely manner.  Again, inserting a secondary layer of “review” invites both executive interference and financial sector slow walking before any effective oversight of financial institutions can be effected.

#4. It is redundant.  All the agencies involved, with the single exception of the Federal Reserve, are already required to do formal cost-benefit analyses of proposals.  In case no one had noticed during the attempts to get the provisions of the Dodd Frank Act implemented that the banks have been availing themselves of these requirements to slow down the whole process — they have.  All this bill accomplishes is to slow the process down from a crawl to a drag.   Here’s why:

“The thirteen new analytic requirements this legislation could impose are only the beginning of the delays and burdens it would create. The mandated OIRA review of significant rules would take up to six months. In addition, the review process could force agencies to go back to the drawing board or do a re-proposal of the rule, which could add years to the regulatory process. While agencies could overrule an OIRA determination that a rule or a cost-benefit analysis was inadequate, such a step would render the regulation highly susceptible to court challenge. It would make industry attempts to overturn new rules in court almost inevitable. The increased risk of court reversal will discourage independent financial agencies from finalizing any regulation that receives a negative OIRA review.” [AFR pdf] (emphasis added)

In short, what we have here is a bill that simply refuses to die… and one which is unnecessary, unwarranted, and merely serves to benefit the financialists who don’t want oversight of their speculation in the Wall Street Casino.

Perhaps we might initiate newly elected Nevada Senator Dean Heller’s in-box with a few e-mails indicating that this is not a bill which deserves the support of 99.9% of the American public?

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Filed under conservatism, Economy, financial regulation, income inequality, income tax, tax revenue, Taxation

Coffee and the Papers: BBA Babble and Privatization Plans

– – How much more can one say about the symbolic (and rather stupid) idea of a federal Balanced Budget Amendment? (1)  However, that hasn’t stopped Rep. Mark Amodei (R-NV2) from jumping on the BBA Bandwagon.  [SPJ] Rep. Amodei is presently serving as a amplifier for the “42¢ claim” espoused by Rep. Paul Ryan which argues that $0.42 of every federal dollar spent is borrowed.  The number is in the ballpark [FactCheck] but the argument is still misleading.

The confusion comes from the definition of “debt,” are we talking about the total debt or that portion known as the public debt?  In the 42¢ Argument the basic reference is to the public debt.  [FactCheck] So, this excludes treasuries held by the Social Security trust funds and other government accounts.  The 42¢ claim gets a “half-true” from the Fact Checkers because:

It has long been widely reported that both the nation’s debt and its debt limit are $14.3 trillion. And that’s what the radio discussion was about. So when Ryan said that half of the nation’s borrowing comes from foreign countries — singling out China for emphasis — his listeners would assume he meant half of the $14.3 trillion in total debt, not the much smaller debt measure he now says he was referring to, even if that second measure has strong merit in the debt limit discussion. (emphasis added)

Those who would like to do their own calculations should refer to the Department of the Treasury’s Financial Management Service which issues the MTS, or “Monthly Treasury Statement.”

At the risk of redundancy, we’ve covered this Balanced Budget argument before, with predictable conclusions:

Thus, what we have in Congressional District 2 is a Republican candidate delighted to proclaim his support for a policy which:  (1) Protects the tax havens, loopholes, and special provisions for the ultra-wealthy, while (2) Further impacting the already precarious finances of and support for the American middle class, and which is (3) unenforceable without significant judicial activism.

Worse still, it is close to being (4)  false advertising.  No, it won’t make the national budgets like the state ones, because the state ones still allow debts incurred for capital project investment.  And, no, it’s not like the family budget either — unless we’re speaking of a family that doesn’t take out vehicle, student, or car loans, and pays cash for all medical and educational expenses, and doesn’t put anything on a credit card. [DB]

Someone in Amodei’s audience needed to have ask if it would be fiscally responsible to forbid the federal government from issuing bonds (like any local school district) for the construction of capital projects (like facilities for DoD installations)?  Or, if his 42¢ figure was (a) current or (b) based on total or  public indebtedness. (2)

– – If you thought “Moving Your Money” would put the brakes on increasing bank fees, please think again.  The New York Times reports on the new and newly increasing fees for retail banking. [TP] WealthInfoMatic$ has some good advice for those thinking of joining the Money Moving contingent.  The report from the Pew Charitable Trusts (April 2011) indicates the average bank applies approximately 49 fees for its retail services.  The full report (945K pdf) can be found here.

– – The “clean” coal folks and the American Petroleum Institute would have us believe that those “onerous” regulations from the federal government are holding back economy recovery and job creation.  Not so. (3)

“…several major media outlets deserve credit for fact-checking the claim and making clear just how wrong the argument is. Recent analyses from CNN, the New York Times, the AP, the Economic Policy Institute, the Wall Street Journal, and McClatchy newspapers — relying on, among other things, BLS data, surveys from the National Federation of Independent Business, and Brookings Institution scholarship — all said the same thing: government regulations are not responsible for holding back the economy.” [WashMonthly]

– – Not everything said by the pundits on the television broadcast sets is really worth listening to, and the Booman Tribune provides a particularly effective skewering of David Brooks’ inane commentary on the Penn State child abuse scandal.

– – In case you missed it, reviewing former Michigan Governor Granholm’s commentary on jobs might be in order:

Among the lessons that hit home the hardest occurred back in 2003, when she tried to keep an Electrolux plant in Greenville, Mich. (the “Refrigerator Capital of the World”). Then-Gov. Granholm offered the company all sorts of incentives, including tax breaks and worker concessions, only to be told by Electrolux that “there is nothing you can do to compensate for the fact we can pay $1.17 an hour for labor in Mexico.” [SFgate] (emphasis in original)

Crooks and Liars updates this information with video from Granholm’s recent appearance on CNN.  More “free” trade agreements anyone?

– – Digby’s blog has some excellent advice for #OWS organizers in regard to dealing with the “A-hole problem.”  The advice is also pertinent to anyone doing community organizing for just about any issue on the political spectrum.

– – If you’ve not already bookmarked Perrspectives, the article on GOP candidate Mitt Romney’s proposal to privatize Medicare and Veterans Health Services should be reason enough.  See also: Romney Proposes to Privatize Medicare [WSJ] and Paul Krugman on Vouchers for Veterans. [NYT]

– – Finally, if you don’t have the time to click over to any other item referenced in this post PLEASE see “Penn State, my final loss of faith…” by Thomas Day, published by the Washington Post.

Notes and References: (1) A previous post, “Balanced Budget Amendment, or Bogus Blather for America?” appeared in DB on July 18, 2011, complete with a list of references and suggested resources.  See also: Talking Points Memo on current efforts by the GOP controlled House to bring up one of three versions of the Balanced Budget Amendment.

(2) A much more inclusive report of Rep. Amodei’s presentation in Winnemucca, NV can be found in the Silver Pinion Journal.

(3) There’s more from Politicsusa on EPA as “aliens.”

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Filed under Amodei, Medicare, Politics, Romney, Veterans