Debunking Anti-Regulatory Rhetoric
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| Wishful thinking |
By
Phil Mattera, Dirt
Diggers Digest
Belief in the infallibility of papal pronouncements is not as
great as it used to be, but conservatives have lost none of their reverence for
the statements of corporate executives.
Nowhere is this clearer than in the new
Congress, where Republicans seem preoccupied with addressing calls for
regulatory “reform” from business leaders.
The vote in the House to begin gutting Dodd-Frank is the case in
point. Conservatives appear to have taken to heart the dubious complaints by
banks that they are being crippled by what are actually far from draconian
restrictions.
First of all, the fragmentation of bank regulation in the United
States is an old issue that has nothing to do with the severity of the oversight.
Several agencies treating banks with kid gloves do not amount to something more
onerous than having one do so.
What makes Dimon’s laments all the more absurd is that they come
from the head of a bank with an abominable track
record. This is the bank that in 2013 had to pay $13 billion to
settle federal and state allegations concerning the sale of toxic
mortgage-backed securities.
It is also the bank that suffered a $2 billion
trading loss generated by a group of London-based traders that top management failed to rein in and that Dimon himself
all but excused in a blustering appearance before
a Congressional committee.
And it is the bank that a year ago paid $1.7 billion to victims of the Ponzi
scheme perpetuated by Bernard Madoff to settle civil and criminal charges of
failing to alert authorities about large numbers of suspicious transactions
made by Madoff while it was his banker.
Criticisms of financial regulations coming from someone like
Dimon should be accorded as much respect as denunciations of the racketeering
laws coming from a mobster.
Another key source of overheated anti-regulation rhetoric is the
U.S. Chamber of Commerce.
The Washington Post’s Dana Milbank
has published a funny but telling account of how top officials of the
powerful trade association reacted when he asked them how their dire warnings
about the threats to free enterprise posed by the Obama Administration squared
with the recent good news about the economy.
Chamber President Tom Donohue and chief lobbyist Bruce Josten
called Milbank “crazy” for saying that the Chamber had ever issued such
warnings, with Donohue offering to buy the journalist lunch if he could produce
such statements. Of course, Milbank goes on to reproduce several overwrought quotes.
It’s quite possible that the likes of Donohue and Josten are so
used to speaking in exaggerated terms that they forget the meaning of their
words.
Unfortunately, their acolytes in Congress, who receive those
words wrapped in campaign contributions, take the messages all too seriously.
