with insertion of Dodd-Frank rollback, Wallstreet's Wolfpack dispenses with the sheeps clothing
.. In a bit of an indicator of what things will be like starting in January, the GOP inserted a roll-back of a provision of the Dodd-Frank Finanacial reform law into the Omnibus funding bill. The inserted bit of language allows banks to play with Credit Default Swaps with Federally insured deposits and in another classic example of GOP civic cynicism - it was written by Citigroup lobbyists. Thus, Wallstreets Wolfpack, the GOP, is dropping all pretenses of responsible governance - there is no ethical or economic rationale for such a move - and is beginning its unabashed run-down and destruction of rational regulation of Casino bankers. Give the GOP a few years and we should be right back where we were in the last bit of Supply Side prosperity we enjoyed, complete with credit meltdown and imminent economic collapse.
Wall Street’s Revenge - Dodd-Frank Damaged in the Budget Bill - Paul Krugman
Last week Congress passed a bill to maintain funding for the U.S. government into next year, and included in that bill was a rollback of one provision of the 2010 financial reform.
In itself, this rollback is significant but not a fatal blow to reform. But it’s utterly indefensible. The incoming congressional majority has revealed its agenda — and it’s all about rewarding bad actors.
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Now, this isn’t the death of financial reform. In fact, I’d argue that regulating insured banks is something of a sideshow, since the 2008 crisis was brought on mainly by uninsured institutions like Lehman Brothers and A.I.G. The really important parts of reform involve consumer protection and the enhanced ability of regulators both to police the actions of “systemically important” financial institutions (which needn’t be conventional banks) and to take such institutions into receivership at times of crisis.
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But what Congress did is still outrageous — and both sides of the ideological divide should agree. After all, even if you believe (in defiance of the lessons of history) that financial institutions can be trusted to police themselves, even if you believe the grotesquely false narrative that bleeding-heart liberals caused the financial crisis by pressuring banks to lend to poor people, especially minority borrowers, you should be against letting Wall Street play games with government-guaranteed funds. What just went down isn’t about free-market economics; it’s pure crony capitalism.
And sure enough, Citigroup literally wrote the deregulation language that was inserted into the funding bill.
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