Friday, March 16, 2018

Bipartisan Approval For Financial Disaster



In a brilliant, July 2016 article, Alex Nichols wrote about a celebrated musical "The most obvious historical aberration is the portrayal of Washington and Jefferson as black men, a somewhat audacious choice given that both men are strongly associated with owning, and in the case of the latter, raping and impregnating slaves."

The New York Times observed "Conservatives were particularly smitten" over Hamilton, and Rupert Murdoch labeled it "historically accurate," somehow appropriate for the guy who ultimately presides over the fanciful editorial page of The Wall Street Journal.

Naturally, then-President Obama also gushed, remarking "I'm pretty sure this is the only thing that Dick Cheney and I have agreed on-during my entire political career." Nichols added  "That is, of course, false. Other points of agreement include drone strikes, Guantanamo, the NSA, and mass deportation."

Fortunately, President Obama was a little less favorably disposed than Bush-Cheney toward the financial institutions which disrupted, and nearly destroyed, the world economy in the latter stage of the previous administration. Though only one Wall Street executive went to prison, Obama did sign into law in July 2010 Dodd-Frank, which, the New York Times explained at the time

subjects more financial companies to federal oversight and regulates many derivatives contracts while creating a consumer protection regulator and a panel to detect risks to the financial system.

A number of the details have been left for regulators to work out, inevitably setting off complicated tangles down the road that could last for years.

But “because of this law, the American people will never again be asked to foot the bill for Wall Street’s mistakes,” Mr. Obama said before signing the legislation. “There will be no more taxpayer-funded bailouts. Period.”

Not so fast, big guy. There may be more "taxpayer-funded bailouts" In part for the same reason there was widespread acclaim for Hamilton:  the spirit of bipartisanship.

On Wednesday, the Senate passed by  67-31 the Economic Growth, Regulatory Relief, and Consumer Protection Act, presumably named because it will reduce government oversight on banks with assets of up to $250 billion and provide comfort and relief to billionaire bank executives, referred to here as "consumers."

Earlier this month, the Boston Globe had pointed out that critics of  the legislation- the opening salvo of the Masters of  the Universe in overturning Dodd-Frank- "say that threshold is too  high, since the  failure of two or three of those mid-sized banks would be the equivalent of one big bank failing."
The Globe writes that one change "would empower big banks to secure more favorable treatment fromthe government" because it would require "the Federal Reserve to tailor regulations on the biggest banks individually for  each firm rather than aplying the same rules across the board."  Warren maintains it "may be the single most dangerous provision in the entire bill" and would result in "systematic weakening of  the  rules for all the big banks"





But as with Hamilton, there was bipartisan comity, with16 Democrats joining all 50 Republicans in voting for passage.  Senate Banking committee member and Democrat Joe Donnelly of Indiana commented "This legislative package is an example of what we can achieve by working together and shows Democrats and Republicans can break the gridlock. I’m proud my bill passed the Senate" and "look forward to the passage of my bill in the House, so that it can head to the president’s desk.” But Charlie Pierce recalls

All of those “compromises” of the early- and mid-19th century did nothing but delay the inevitable cataclysm over slavery. Support for Jim Crow often was “bipartisan,” as was the foreign adventurism that overthrew governments in places like Iran and Guatemala and that reached its bloody apex in Vietnam. The panic that produced the Patriot Act after the 9/11 attacks was bipartisan, as was the support for the war in Iraq for which that panic was exploited by a bunch of think-tank cowboys. More to the point, a lot of the measures that led to the financial collapse that led to the regulations now under assault were quite bipartisan. To say something is to be praised simply because it is something that “got done” in our “polarized age” is a simpleton’s view of politics.

Once the bill is approved by the House, President Trump will take a break from assailing members of Congress as "a low-IQ individual" or "a total phony" and sign the bill, citing it as an example of how he can get everyone to work together. And as one, the "liberal media" will join other opinion-makers in standing and applauding.




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