Banks’ Lobbyists “Help” in Drafting Financial Bills
Who writes the laws? The lobbyists.This isn’t completely true, but it is true to a very large extent as this article explains.
The thicker the law, the more opaque the legislation, the more opportunities there are to make money. There’s a reason Obamacare is a stack of papers taller than a man, same for Dodd-Frank. Both laws deal with impossibly complex areas of the economy best left to market mechanisms. To a very large extent the problems which both Obamacare and Dodd-Frank seek to address, access to healthcare and a corrupt banking system respectively, are problems created by prior government involvement in the marketplace.
But Americans always seem to forget this. Sadly a significant portion of the population continues to have a near religious faith that someday the virtuous will finally take the reins of power and government will finally work for the people darn it!
This is a fairy tail.
Despite what we have been taught all our lives about the power of government to do good, and it does on occasion do some good, for the most part government makes things better for the rich and connected and marginalizes the average person. Sure government will throw some bones to folks just to keep them in their place, but for the vast majority of Americans government is not their buddy. It may be necessary, but it is not a benevolent force (unless one has membership in the club.)
Marx was wrong. FDR was wrong. Nixon was wrong. Obama is wrong. Thomas Jefferson was right. The government which governs best, governs least.
How about instead of creating a law (Dodd-Frank) which is sold to the American public as a regulatory scheme to deal with “too big to fail” but which actually institutionalizes TBTF and now provides a huge taxpayer subsidy to the big banks, we just let the market sort it out. How about we let the big banks go bankrupt?
But who would pay all the bank lobbyists who write all the bank “legislation” then?
(From The New York Times)
“The bill restores the public subsidy to exotic Wall Street activities,” said Marcus Stanley, the policy director of Americans for Financial Reform, a nonprofit group.
But most of the Democrats on the committee, along with 31 Republicans, came to the industry’s defense, including the seven freshmen Democrats — most of whom have started to receive donations this year from political action committees of Goldman Sachs, Wells Fargo and other financial institutions, records show.
Six days after the vote, several freshmen Democrats were in New York to meet with bank executives, a tour organized by Representative Joe Crowley, who helps lead the House Democrats’ fund-raising committee. The trip was planned before the votes, and was not a fund-raiser, but it gave the lawmakers a chance to meet with Wall Street’s elite.
In addition to a tour of Goldman’s Lower Manhattan headquarters, and a meeting with Lloyd C. Blankfein, the bank’s chief executive, the lawmakers went to JPMorgan’s Park Avenue office. There, they chatted with Jamie Dimon, the bank’s chief, about Dodd-Frank and immigration reform.