America, You Asked For It!

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Bipartisanship achieved in blocking of Dodd bill

by John Allison III, editor

There’s been so much clamoring for it since January 2009, and so little of it accomplished in that time.

But today, finally, after more than a year of partisan vote after partisan vote, Democrats can claim they have achieved bipartisanship since one of their own leaped the fence to join Republicans in voting against cloture on a bill by Senator Chris Dodd to place taxpayers on the hook permanently for bailing out poorly-run private companies.

Senator Ben Nelson of Nebraska abandoned his party’s herd of Jackasses to join Republicans in voting against cloture on the bill. According to CBS News, “Nelson said he couldn’t support moving to debate on a bill he hasn’t seen.”

Which apparently means a lot of Democrats DID vote for a bill they haven’t yet seen!

Republicans have criticized a measure in the Dodd bill that will set aside $50 billion for a future bailout fund. Though the $50 billion would be collected from the financial firms covered by the clause, Republicans rightly point out those costs would be passed onto consumers and investors.

The demand for the fund also demonstrates Democrats’ commitment to the no-longer-novel idea of government agencies choosing winners and losers in the private marketplace. With the American public adamantly opposed to additional bailouts under any circumstances, Democrats aren’t willing to cede Uncle Sam’s newly found power to prop up failing firms.

But conservatives opposed to increased government interference with the operations of the free market shouldn’t view the vote as an outright victory. Instead of pointing out the role of Congress and government regulations in fueling the conflagration that defined the recent economic meltdown, GOP lawmakers are instead tweaking the regulations written by Dodd and his Democrat cohorts to invent their own designer set of handcuffs to restrain the industry.

“All of us want to deliver a reform that will tighten the screws on Wall Street,” says Mitch McConnell (R-KY), leader of the minority party in the US Senate.

McConnell and the Democrats made no mention of the mountains of regulations that already exist to prevent crises such as that we saw begin in late 2008. Nor did they mention the recent discovery that SEC regulators passed their workdays viewing porn on the government computers they should have been using to keep tabs on the financial giants that crashed.

Neither did they reference the role the quasi-government companies Fannie Mae and Freddie Mac played in nearly crippling the US economic system. The contributions FNE and FME to the crash of 2008 were made possible by none other than Demo-Socialist Congressman Barney Frank of Massachussetts.

Frank blocked every Republican effort to reel in the dangerous practices of the two mortgage giants earlier in this decade. The Massachusetts moron virtually forced the companies to guarantee loans to customers they knew couldn’t be counted on to repay.

The blame for the near collapse of our financial system lies as much (if not more) at the feet of our incompetent legislators and their bureaucrat underlings as it does at the hands of the CEO’s who steered their ships as they ran aground.

Democrats have scheduled hearings to highlight the recent fraud charges brought by the SEC against Goldman Sachs, but nobody mentioned documents the financial firm released that it claims repudiate the charges of fraud leveled by Democrats.

Neither did we hear anyone from either side pointing to the politics involved in launching the government’s fraud suit immediately before the unveiling of Dodd’s bill.

It seems inevitable that our fumbling, bumbling elected elite will pass a more burdensome regulatory scheme that will increase costs and reduce efficiency in the financial markets before November. And it will likely enjoy bipartisan support.

Not because it’s best for the country, but because leaders of both parties want more control and to claim credit for preventing some future crisis.


Tags: Obama, Obamacare, Harry Reid, Chris Dodd, Finance, Economy, Financial Regulations, Regulatory Reform, Reform, US Senate, Republicans, GOP, Mitch McConnell

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April 26, 2010 - Posted by | Democrats

3 Comments »

  1. […] Bipartisanship achieved in blocking of Dodd bill […]

    Pingback by Joe Klein vs. Average Joe: 4/26-PCW Night of Champions « Political Championship Wrestling | April 26, 2010 | Reply

  2. This article completely misconstrues the reality of the Senate Bill, and I hope any reading it notices how blatantly one-sided and inaccurate the reporting is. The quote “place taxpayers on the hook permanently for bailing out poorly-run private companies.” Is a gross misrepresentation of the way the bill works.

    1. The bill gives the FDIC the ability to dismantle banks and large institutions that pose systemic risk to the entire economy. YES, the FDIC will use funds (in this bill $50 billion) to continue the operations of these dying banks for the strict purpose of keeping their value intact while selling them off to other buyers. This is like someone taking a car without gasoline and putting a half gallon in just to prove to potential buyers that it can run.

    2. Once the FDIC has sold off the bank’s assets it no longer exists. I ask the editor this question: How can it be a bail out if the company is gone afterward? It is a dismantling to avoid broad risk to the entire economy.

    3. As for passing the cost on to taxpayers this, again, is incorrect. Banks currently have to pay fees into the FDIC and yes they may cost customers portions of interest levels, however that is very different than the US Federal Government bankrolling a bailout. Also, since banks are seeing larger profits than anyone seems to feel comfortable with, the fees would likely just come from this and not result in higher costs of business.

    To say that the bill transitively costs the tax payers AND is a bailout is part of the misrepresentation of the true bill being discussed and anyone getting their information from this news source should do further research before accepting this as gospel.

    Lastly, Ben Nelson, a conservative Democrat, has said that he has reservations about certain parts of the Consumer Protection Agency and the Derivatives regulations. He obviously has read through the bill and knows what is in it. What his quote above referenced was the “final” bill which does not even exist yet. The cloture vote on Monday was to begin debate on the bill and open it for amendments. I think all Americans would prefer the debate and the changes be made on the floor of the US Senate in public and NOT in the back rooms that the GOP has now forced the discussions to take place in.

    Comment by Thompson Leveritt | April 27, 2010 | Reply

  3. 1. The government already has anti-trust laws that prevent mergers that enable companies to become too big to fail. Phone prices sure went up since they broke up AT&T; so did the number of consumer complaints of fraud and misrepresentation; not to mention bad service at a few.

    2. The FDIC’s purpose is to manage failing banks and the banks already pay in fee’s for this insurance. It is supposed to be there for this purpose … so why did congress have to come up with it to begin with. Must be run similar to Social Security; we pay in and it ends up out the door for pork and earmarks,and now we need they want to add a value added tax to raise money to pay for it.
    At what point is it a power grab? Would anyone have called any of these banks too big to fail in 2006? Doubt it! The trouble is that existing laws were not enforced. The root of the problem needs to be fixed; not the symptom. Mortgage brokers (unregulated) helped customers file fraudulent loan applications. Banks trusted the brokers and gave out loans to people who should never have qualified. The banks should not be the targets. They (and their customers and investors) are (for the most part) vicitms. Yes, they are aware that some loans will default; but when they set aside the legally required provisions for losses they were modeled on the lies fed to them by the morgage industry and their clients. Why aren’t they standing in front of the regime? Because they are not regulated and it is easier to haul the bankers to the stand than file crinimal charges against a numerous individuals. Justice would include fraud charges against the people the banks bought the mortgages from. I am not saying the banks did not make mistakes; I am saying I do not believe they had criminal intent. Someone who falsifies a loan application does.
    3. Derivatives and hedging allow companies to puchase fuel, feed … input for future use in advance. When the gas prices shot up, people hedged by filling up cars whenever they heard prices were rising. Screwing up a companies ability to use derivatives, even if leveraged, will hurt the end consumer in the long run. If the airline can’t get cheap gas by buying in advance you seat will cost more. It is not all about housing bundles (CDO’s and Credit swaps…) is the point. The root of the problem is people buying what they can’t afford, brokers selling houses by faking the customers income(fraud), banks relying on brokers that are not regulated, and then bundling the morgages for sale. The SEC, federal and state governments have laws that were not enforced.
    4. There is already a fee paid to the SEC when a trade is placed. They should be able to live within their means… consider the massive volume of trades that have ensued since the crash began. The SEC had an enormous amount unexpected revenue. This should not be handed over to create another agency. It should be used to enforce existing laws.
    5. We were supposed to be able to read the healthcare bill before to vote and it was a disgrace to post it on a Friday and vote on Sunday. I could not reach my representatives to address a concern. This is not democracy by the people. They should post all legislation, with ammendments, for at least a month before it is brought to a vote so the people can have their voice.

    Comment by Karen | April 27, 2010 | Reply


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