Do America’s financial markets really need more regulation? To hear the presidential candidates (and countless pundits) talk, you’d think so. Example: As James Freeman notes in today’s Wall Street Journal, Barack Obama, in the second presidential debate said:
I believe this is a final verdict on the failed economic policies of the last eight years . . . that essentially said that we should strip away regulations, consumer protections, let the market run wild, and prosperity would rain down on all of us.
“Strip away regulations”? “Run wild”? Really?
It would be pretty hard to find a market anywhere in the world — except maybe China — that is more tightly regulated, especially since the implementation of the 2002 Sabanes-Oxley Act.
One had to look far and wide in the spring of 2002 to find anyone who thought the Sarbanes-Oxley law was an experiment in cowboy capitalism. For example, on its front page of April 25, 2002, the New York Times reported: “House and Senate negotiators agreed . . . on a broad overhaul of corporate fraud, accounting and securities laws aimed at curbing the rampant abuses that have shaken Wall Street . . . Some lawmakers called it the most sweeping securities legislation since the 1930s.”. . .
Indeed, it’s hard to imagine anything left of a “free market” if Congress adds to the regulatory flood produced during the Bush administration which, by objective measures, set historical highs in terms of market regulation:
Wayne Crews of the Competitive Enterprise Institute . . . reports that the Bush administration set an all-time record in 2004, when it published more than 75,000 pages of proposed and enacted rules in the Federal Register. . .
A recent report, “Regulatory Agency Spending Reaches New Height,” from Washington University’s Weidenbaum Center puts Mr. Bush’s regulatory activity in historical context. . . when it comes to spending on regulatory agencies, our current president is almost in a class by himself, with an increase of almost 68% during his two terms. In constant dollars the Bush regulatory budget increases vastly exceed those of predecessors Clinton, Bush, Reagan, Carter, Nixon and, yes, Lyndon Johnson.
The next time anyone — Obama, McCain, congress people or pundits — whines indignantly about lax regulation during the Bush administration or how lack of regulation produced today’s market turbulence, you’ll know they are either uninformed or lying. Lack of focus, perhaps. Lack of regulation, not.
More at WSJ.
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Could be you’re right, Kurt. We donn need no stinkin regulators when Barney Frank is on the job!!
Barney Frank Lays Down The Law
Posted by Phoenix Woman on November 2, 2008
Congressman Frank reminds everyone that bailout funds must be for lending. Period:
Companies receiving public money under a U.S. government financial rescue program must use it for lending or they will be violating the law, the powerful chairman of the U.S. House of Representatives Financial Services Committee said on Friday.
“Any use of the these funds for any purpose other than lending — for bonuses, for severance pay, for dividends, for acquisitions of other institutions, etc. — is a violation of the terms of the act,” Rep. Barney Frank, a Massachusetts Democrat, said in a statement.
Frank was referring to a $700 billion financial rescue law passed by Congress earlier this month. The Treasury Department plans to use $250 billion of that amount to inject capital into financial institutions to unfreeze credit markets and restore lending.
A growing number of Democratic lawmakers have demanded more restrictions on banks receiving government money.
More like this, please.