Obama's Regulatory Tsunami

[rdean]

Which regulations did Bush cut?

We've been discussing this in the since 2009 88 percent thread and I have two long posts in there that detail what the bush administration did to the financial industry. You can click the quote buttons on those posts and reply to them as I've been inviting everybody else to do.

Two long posts with no proof Bush deregulated the financial industry.

Try this one.

McCain Embraces Regulation After Many Years of Opposition

In 2002, McCain introduced a bill to deregulate the broadband Internet market, warning that "the potential for government interference with market forces is not limited to federal regulation." Three years earlier, McCain had joined with other Republicans to push through landmark legislation sponsored by then-Sen. Phil Gramm (Tex.), who is now an economic adviser to his campaign. The Gramm-Leach-Bliley Act aimed to make the country's financial institutions competitive by removing the Depression-era walls between banking, investment and insurance companies.

 

[Toddsterpatriot]

We've been discussing this in the since 2009 88 percent thread and I have two long posts in there that detail what the bush administration did to the financial industry. You can click the quote buttons on those posts and reply to them as I've been inviting everybody else to do.

Two long posts with no proof Bush deregulated the financial industry.

Try this one.

McCain Embraces Regulation After Many Years of Opposition

In 2002, McCain introduced a bill to deregulate the broadband Internet market, warning that "the potential for government interference with market forces is not limited to federal regulation." Three years earlier, McCain had joined with other Republicans to push through landmark legislation sponsored by then-Sen. Phil Gramm (Tex.), who is now an economic adviser to his campaign. The Gramm-Leach-Bliley Act aimed to make the country's financial institutions competitive by removing the Depression-era walls between banking, investment and insurance companies.

Was any of that supposed to prove Bush deregulated the financial industry?

 

[oreo]

Also, corporations are holding a lot of cash offshore since repatriating cash would be taxed at 35%. The US should change that law and not tax foreign earnings but also disallow some tax avoidance schemes that allow corporations to wash cash though offshore shell companies.

Business is TERRIFIED of this President and administration. For 3-1/2 years they have continually been threatened with more regulation--(Obamacare) and higher taxes.

Here is a comment from Steve Wynn--a CEO and a democrat who voted for Barack Obama.

“I’m saying it bluntly, that this administration is the greatest wet blanket to business, progress and job creation in my lifetime. A lot of people don’t want to say that. They’ll say, ‘Oh God, don’t be attacking Obama.’ Well, this is Obama’s deal, and it’s Obama that’s responsible for this fear in America.”

“The guy [Obama] keeps making speeches about redistribution, and maybe ‘we ought to do something to businesses that don’t invest or hold too much money.’ We haven’t heard that kind of talk except from pure socialists.”

“Business is being hammered. The business community in this country is frightened to death of the weird political philosophy of the president of the United States. Until he’s gone, everybody’s going to be sitting on their thumbs.”

Steve Wynn's Anti-Obama Rant - Is He Right? | BNET

If you want JOBS in this country--you're going to have to vote for someone other than Barack Obama--and one who has lots of experience in the private sector--one who is pro business-&-not anti-business. It's as simple as that. Barack Obama is so far in over his head---that he does not have a CLUE as to what he has doing.

 

[Raoul_Duke]

Which regulations did Bush cut?

We've been discussing this in the since 2009 88 percent thread and I have two long posts in there that detail what the bush administration did to the financial industry. You can click the quote buttons on those posts and reply to them as I've been inviting everybody else to do.

I am not going to go searching the board to make it easier for you. If you will not answer the question I will take it as you not having an answer, and proceed on that assumption.

Here's the first one. Answer this one and I'll find the second one :

http://www.usmessageboard.com/polit...te-profits-1-went-to-wages-4.html#post4154905

 

[Disenchanted61]

One aspect of Obamanomics that has been overshadowed by the spending and tax discussions is the vast increase in regulations which are suffocating the recovery.

219 regulations costing a minimum of $100M/year each are in the queue for implementation. When the private sector is forced to absorb more than $200B of increased over ten years, jobs are Not Created.

And Obama these are on top of the estimated $380B that Obama has already been enacted.

The report by the House Oversight and Government Reform Committee headed by Rep. Darrell Issa, R-Calif., took aim at Obama's "regulatory tsunami" and concluded that the pace and scale of new regulations threatens the ability of the government to fulfill even its most basic regulatory functions. Here's how the congressional panel summarized its conclusions:

"The Obama Administration has created a regulatory environment that is suffocating America's entrepreneurs' ability to create jobs and grow businesses, ... This regulatory tsunami has caused job creators to lock down at a time when we need them to expand. The committee has found that the problems created by this regulatory tsunami goes far beyond the cost of the regulations themselves, but also include breakdowns in the regulatory process itself that is having a severe impact on large and small businesses alike."

Specifically, the panel found at least 219 "economically significant regulations in the pipeline, which if finalized, will impose costs of $100 million or more annually on the economy." That's a minimum of $219 billion in added costs to do business in this country over the next decade. Even worse, the panel found the Obama bureaucrats have already imposed 75 major new regulations that are projected to add another $380 billion in costs.

The Issa panel concluded that, as a result of this flood of new rules, "the regulatory process is broken" and that it is "being manipulated and exploited in an effort to reward allies of the Obama administration such as environmental groups, trial lawyers and unions."

Why the U.S. economy is headed for a double dip | Examiner Editorial | Opinion | Washington Examiner

fOOLS LIKE YOU ARE GETTING THE CEMENT ENEMA THEY DESERVE

 

[Dragon]

When the private sector is forced to absorb more than $200B of increased over ten years, jobs are Not Created.

This is false. What drives job creation is not costs but sales. When demand for the products and services exceeds what the current staffing can deliver, people are hired. When demand (and therefore sales) drops below capacity, people are laid off. Adding costs to businesses does not inhibit hiring.

The economy was far, far stronger during the times when taxes on the rich were much, much higher and regulations were much, much more stringent than they are today.

 

[eflatminor]

Adding costs to businesses does not inhibit hiring

Hey! We have a winner here! The dumbest statement of the day goes to Dragon. Congratulations Dragon!

 

[Dragon]

Hey! We have a winner here! The dumbest statement of the day goes to Dragon. Congratulations Dragon!

Prove me wrong.

 

[Quantum Windbag]

We've been discussing this in the since 2009 88 percent thread and I have two long posts in there that detail what the bush administration did to the financial industry. You can click the quote buttons on those posts and reply to them as I've been inviting everybody else to do.

I am not going to go searching the board to make it easier for you. If you will not answer the question I will take it as you not having an answer, and proceed on that assumption.

Here's the first one. Answer this one and I'll find the second one :

http://www.usmessageboard.com/polit...te-profits-1-went-to-wages-4.html#post4154905

I asked you a question, if you do not have an answer just say so. You continuous attempt to force me to answer your questions and address issues I am not asking about is a transparent attempt to deflect.

Which regulations did Bush cut?

 

[eflatminor]

Hey! We have a winner here! The dumbest statement of the day goes to Dragon. Congratulations Dragon!

Prove me wrong.

No, no, you won baby! It's all yours.

Clearly, if I as a business owner uncover a large unexpected expense, the first thing I'm going to do is go hire another worker. Absolutely. Gosh, if only the IRS would hit me with a giant fine, why I could go on a hiring spree!

If only I had met you sooner, such a sage you are!

 

[Dragon]

No, no, you won baby! It's all yours.

No, you have to show first that my post was stupid. Your say-so won't cut it. I don't deserve the award until then.

Clearly, if I as a business owner uncover a large unexpected expense, the first thing I'm going to do is go hire another worker

See if you can tell me the difference between these two sentences:

1) Adding costs to a business does not inhibit hiring.

2) Adding costs to a business makes the business hire more people.

For a bonus, tell us which one was what I actually said.

For a bigger bonus, tell us which one was a rephrase of what you said I said.

 

[eflatminor]

No, no, you won baby! It's all yours.

No, you have to show first that my post was stupid. Your say-so won't cut it. I don't deserve the award until then.

Clearly, if I as a business owner uncover a large unexpected expense, the first thing I'm going to do is go hire another worker

See if you can tell me the difference between these two sentences:

1) Adding costs to a business does not inhibit hiring.

2) Adding costs to a business makes the business hire more people.

For a bonus, tell us which one was what I actually said.

For a bigger bonus, tell us which one was a rephrase of what you said I said.

This is silly. Logic and reason are not on your side here. I'm done with your games but tell you what, why you tell us exactly how adding expenses to a business has no detrimental effect on hiring. That IS what you said. Let's hear it.

 

[Dragon]

This is silly. Logic and reason are not on your side here.

Sure they are, or if not, you haven't shown it.

I'm done with your games

They were your games, friend, not mine, but I'm glad you're done with them.

but tell you what, why you tell us exactly how adding expenses to a business has no detrimental effect on hiring. That IS what you said. Let's hear it.

Fine.

A business hires the people it needs to in order to produce the products or services it thinks it can sell. If it's obvious that it can't sell all of what it's producing, and efforts to generate more sales (e.g. advertising) don't remedy the problem, then it lays people off. On the other hand, if it's obvious that it can't produce enough to satisfy its customers, then it hires more people so as to be able to produce more. (Either that or it cedes the business to its competitors, which of course it doesn't want to do.)

Note that neither of these decisions has anything to do with the cost of doing business.

What does a business do when costs go up? Assuming the demand is there for all of the products/services it can put on the market with the staff it has, laying off people is the LAST thing it will do. It will, instead, cut costs elsewhere, or raise prices. (Note that for most cost increases, including all of those imposed by government action, all of its competitors are facing the same choices, so raising prices probably won't hurt it, as its competitors will be doing the same.)

Now, to be sure, if a business can find ways to put the same amount and quality of product on the market with fewer employees, it will do that, but it will do that regardless of costs, just because that's sensible. But if laying someone off means cutting back on the quality or quantity of what it has to sell, then it will ONLY do that if the market isn't there to absorb the current production and it is suffering from unsold inventory.

Oh, and of course if it can get cheaper labor without sacrificing quality, then it may replace all or part of its current workforce. But that's not the same as laying people off.

That's what I was saying.

Now, if you still think that's "stupid," then it's incumbent on you to say why.

 

[eflatminor]

...It will, instead, cut costs elsewhere...

Here's why: In the real world, businesses cut costs by requiring the largest portions of their expenses, often salaried and hourly workers, to operate more efficiently. That is, to do more with less people. Happens all the time and it's been going on forever. They'll also cut costs elsewhere do deal with increasing regulatory/taxation expenses but you can be goddamn sure they'll cut workers and/or slow the rate of hiring when costs increase. They still have to be competitive.

 

[LordBrownTrout]

...It will, instead, cut costs elsewhere...

Here's why: In the real world, businesses cut costs by requiring the largest portions of their expenses, often salaried and hourly workers, to operate more efficiently. That is, to do more with less people. Happens all the time and it's been going on forever. They'll also cut costs elsewhere do deal with increasing regulatory/taxation expenses but you can be goddamn sure they'll cut workers and/or slow the rate of hiring when costs increase. They still have to be competitive.

Exactly, eflat.

 

[Raoul_Duke]

I am not going to go searching the board to make it easier for you. If you will not answer the question I will take it as you not having an answer, and proceed on that assumption.

Here's the first one. Answer this one and I'll find the second one :

http://www.usmessageboard.com/polit...te-profits-1-went-to-wages-4.html#post4154905

I asked you a question, if you do not have an answer just say so. You continuous attempt to force me to answer your questions and address issues I am not asking about is a transparent attempt to deflect.

Which regulations did Bush cut?

I'm not asking you to address issues you're not asking about. I'm asking you to address issues you are asking about. You want to know what regulations Bush cut and I'm giving you a link to a long and detailed post showing exactly whar regulations Bush cut. You simply click the lnik, click the quote button and reply. What do you want me to do, cut and paste a half page post into this thread. Click the link and reply to the post.

 

[Quantum Windbag]

Here's the first one. Answer this one and I'll find the second one :

http://www.usmessageboard.com/polit...te-profits-1-went-to-wages-4.html#post4154905

I asked you a question, if you do not have an answer just say so. You continuous attempt to force me to answer your questions and address issues I am not asking about is a transparent attempt to deflect.

Which regulations did Bush cut?

I'm not asking you to address issues you're not asking about. I'm asking you to address issues you are asking about. You want to know what regulations Bush cut and I'm giving you a link to a long and detailed post showing exactly whar regulations Bush cut. You simply click the lnik, click the quote button and reply. What do you want me to do, cut and paste a half page post into this thread. Click the link and reply to the post.

You keep referring me to another thread, all I want is a simple answer to my question, what regulations did Bush cut?

 

[Raoul_Duke]

I asked you a question, if you do not have an answer just say so. You continuous attempt to force me to answer your questions and address issues I am not asking about is a transparent attempt to deflect.

Which regulations did Bush cut?

I'm not asking you to address issues you're not asking about. I'm asking you to address issues you are asking about. You want to know what regulations Bush cut and I'm giving you a link to a long and detailed post showing exactly whar regulations Bush cut. You simply click the lnik, click the quote button and reply. What do you want me to do, cut and paste a half page post into this thread. Click the link and reply to the post.

You keep referring me to another thread, all I want is a simple answer to my question, what regulations did Bush cut?

How about these regulations? This press conference was just at the start of the housing bubble. See the guy on the left of the picture? The guy holding the chainsaw to the stack of regulations? He spent his career as a Washington lobbyist for banks and financial firms. he basically spent his entire career lobbying Washington to "cut red tape" for his clients and set the markets free to bring us all unparalleled prosperity! In a stunning fox/henhouse move when he took office in 2001, Bush put guys like this in charge of all the various bank regulators. The chainsaw guy was actually responsible for regulating AIG. AIG, the firm that cost taxpayers so much money when the Bush administration socialised their losses, were based in New York and london so naturally th chainsaw guy had them overseen by one guy working from an office in the midwest, when a firm like that would obviously need dozens of regulators to be effectively regulated. AIG decided they didn't want to let him through their front door and called the chainsaw guy to call him off, which worked out so well for us.

The guy Bush appointed to run the SEC also let the country's biggest financial firms lever up their debt:assets ratio from a standard 10:1 to 30 and 40:1, allowing them to take on massive risk and really rack up the losses when the bubble burst.

Bush also pushed for less regulation of the subprime market:

Bush seeks to increase minority homeownership

In a bid to boost minority homeownership, President Bush will ask Congress for authority to eliminate the down-payment requirement for Federal Housing Administration loans.

In announcing the plan Monday at a home builders show in Las Vegas, Federal Housing Commissioner John Weicher called the proposal the "most significant FHA initiative in more than a decade." It would lead to 150,000 first-time owners annually, he said.

Nothing-down options are available on the private mortgage market, but, in general, they require the borrower to have pristine credit. Bush's proposed change would extend the nothing-down option to borrowers with blemished credit.

The FHA isn't a direct lender, but guarantees loan payments for mortgages on moderately priced owner-occupied property. The FHA guarantee now permits private lenders to finance as much as 97% of the purchase price of a home for millions of low- and middle-income borrowers.

In the proposal soon to be delivered to Congress, Bush would allow the FHA to guarantee loans for the full purchase price of the home, plus down-payment costs. As a practical matter, the FHA would guarantee mortgages as high as 103% of the value of the underlying property.


USATODAY.com - Bush seeks to increase minority homeownership

 

[Quantum Windbag]

I'm not asking you to address issues you're not asking about. I'm asking you to address issues you are asking about. You want to know what regulations Bush cut and I'm giving you a link to a long and detailed post showing exactly whar regulations Bush cut. You simply click the lnik, click the quote button and reply. What do you want me to do, cut and paste a half page post into this thread. Click the link and reply to the post.

You keep referring me to another thread, all I want is a simple answer to my question, what regulations did Bush cut?

How about these regulations? This press conference was just at the start of the housing bubble. See the guy on the left of the picture? The guy holding the chainsaw to the stack of regulations? He spent his career as a Washington lobbyist for banks and financial firms. he basically spent his entire career lobbying Washington to "cut red tape" for his clients and set the markets free to bring us all unparalleled prosperity! In a stunning fox/henhouse move when he took office in 2001, Bush put guys like this in charge of all the various bank regulators. The chainsaw guy was actually responsible for regulating AIG. AIG, the firm that cost taxpayers so much money when the Bush administration socialised their losses, were based in New York and london so naturally th chainsaw guy had them overseen by one guy working from an office in the midwest, when a firm like that would obviously need dozens of regulators to be effectively regulated. AIG decided they didn't want to let him through their front door and called the chainsaw guy to call him off, which worked out so well for us.

The guy Bush appointed to run the SEC also let the country's biggest financial firms lever up their debt:assets ratio from a standard 10:1 to 30 and 40:1, allowing them to take on massive risk and really rack up the losses when the bubble burst.

Bush also pushed for less regulation of the subprime market:

Bush seeks to increase minority homeownership

In a bid to boost minority homeownership, President Bush will ask Congress for authority to eliminate the down-payment requirement for Federal Housing Administration loans.

In announcing the plan Monday at a home builders show in Las Vegas, Federal Housing Commissioner John Weicher called the proposal the "most significant FHA initiative in more than a decade." It would lead to 150,000 first-time owners annually, he said.

Nothing-down options are available on the private mortgage market, but, in general, they require the borrower to have pristine credit. Bush's proposed change would extend the nothing-down option to borrowers with blemished credit.

The FHA isn't a direct lender, but guarantees loan payments for mortgages on moderately priced owner-occupied property. The FHA guarantee now permits private lenders to finance as much as 97% of the purchase price of a home for millions of low- and middle-income borrowers.

In the proposal soon to be delivered to Congress, Bush would allow the FHA to guarantee loans for the full purchase price of the home, plus down-payment costs. As a practical matter, the FHA would guarantee mortgages as high as 103% of the value of the underlying property.


USATODAY.com - Bush seeks to increase minority homeownership

The housing bubble started in the 1980s, not sure how you can tie that to Bush since he was in Texas at the time, but we will skip over that.

Eliminating the down payment was not Bush eliminating a regulation, it was him jumping in front of a bipartisan effort to reduce the wealth gap, and it actually required congressional action for it to be implemented. It did not eliminate a regulation, it rewrote it to change the requirements from a token amount up front to a deferred payment that resulted in higher insurance premiums and a higher monthly payment. In other words, even if I were to accept this as eliminating a regulation, it was not Bush who did it, it was Congress.

I see why you wanted me to go to the other thread instead of asking the question here, you actually do not have an example of Bush eliminating a regulation.

 

[Raoul_Duke]

You keep referring me to another thread, all I want is a simple answer to my question, what regulations did Bush cut?

How about these regulations? This press conference was just at the start of the housing bubble. See the guy on the left of the picture? The guy holding the chainsaw to the stack of regulations? He spent his career as a Washington lobbyist for banks and financial firms. he basically spent his entire career lobbying Washington to "cut red tape" for his clients and set the markets free to bring us all unparalleled prosperity! In a stunning fox/henhouse move when he took office in 2001, Bush put guys like this in charge of all the various bank regulators. The chainsaw guy was actually responsible for regulating AIG. AIG, the firm that cost taxpayers so much money when the Bush administration socialised their losses, were based in New York and london so naturally th chainsaw guy had them overseen by one guy working from an office in the midwest, when a firm like that would obviously need dozens of regulators to be effectively regulated. AIG decided they didn't want to let him through their front door and called the chainsaw guy to call him off, which worked out so well for us.

The guy Bush appointed to run the SEC also let the country's biggest financial firms lever up their debt:assets ratio from a standard 10:1 to 30 and 40:1, allowing them to take on massive risk and really rack up the losses when the bubble burst.

Bush also pushed for less regulation of the subprime market:

Bush seeks to increase minority homeownership

In a bid to boost minority homeownership, President Bush will ask Congress for authority to eliminate the down-payment requirement for Federal Housing Administration loans.

In announcing the plan Monday at a home builders show in Las Vegas, Federal Housing Commissioner John Weicher called the proposal the "most significant FHA initiative in more than a decade." It would lead to 150,000 first-time owners annually, he said.

Nothing-down options are available on the private mortgage market, but, in general, they require the borrower to have pristine credit. Bush's proposed change would extend the nothing-down option to borrowers with blemished credit.

The FHA isn't a direct lender, but guarantees loan payments for mortgages on moderately priced owner-occupied property. The FHA guarantee now permits private lenders to finance as much as 97% of the purchase price of a home for millions of low- and middle-income borrowers.

In the proposal soon to be delivered to Congress, Bush would allow the FHA to guarantee loans for the full purchase price of the home, plus down-payment costs. As a practical matter, the FHA would guarantee mortgages as high as 103% of the value of the underlying property.


USATODAY.com - Bush seeks to increase minority homeownership

The housing bubble started in the 1980s, not sure how you can tie that to Bush since he was in Texas at the time, but we will skip over that.

Eliminating the down payment was not Bush eliminating a regulation, it was him jumping in front of a bipartisan effort to reduce the wealth gap, and it actually required congressional action for it to be implemented. It did not eliminate a regulation, it rewrote it to change the requirements from a token amount up front to a deferred payment that resulted in higher insurance premiums and a higher monthly payment. In other words, even if I were to accept this as eliminating a regulation, it was not Bush who did it, it was Congress.

I see why you wanted me to go to the other thread instead of asking the question here, you actually do not have an example of Bush eliminating a regulation.

That's the first time I've heard anybody claim that the housing bubble started in the 1980s. Here are some more facts to add to our discussion, the Case Shiller hosue price index :

So clearly your first argument is rubbish. Let me explain, again with a graph, the particular bubble that initiated the meltdown. And this was the subprime and general bad lending bubble that started in 2002. What happened was that hundreds of thousands of bad loans were written. These loans had cheap teaser rates for an initial two or three years so anybody could afford the monthly payment on a mortgage. But after two or three years the rate reset and people could no longer afford to pay them. A guge amount of bad loans were written in the years before the meltdown as there were no effective lending standards and a ready market on Wall Street for the mortgages. So in the runup to the meltdown there was a vast amount of subprime loans resetting to their higher rates. here, more facts and evidence for you :

And when all those loans reset and people stopped paying their mortgages the securities constructed out of those mortgages started to turn toxic and led to the meltdown. So that's the bad loan bubble and meltdown we're talking about, one that started after Bush took office.


For more facts and evidence here's Wall Street fund manager Barry Ritholtz to explain how deregulation by the Bush administration fuelled the bubble and the meltdown. Barry called the bubble and meltdown years before they happened and you can go through the archives on his site and read everything detailed here in exhaustive detail in real time :


During the early 2000s, the Federal Reserve, under Alan Greenspan Fed elected against supervising new mortgage lending firms. This act of nonfeasance, based upon Mr. Greenspan’s free market philosophy, had enormous repercussions.

The final act of deregulatory zeal were the net capitalizations exemptions granted by the SEC to five firms. This exemption allowed firms to exceed rules limiting debt-to-net capital ratio to a modest 12-to-1 ratio. After the 2004 exemption, firms levered up as much as 40 to 1. Not surprising, the five brokers that received this exemption – Goldman Sachs, Merrill, Lehman Brothers, Bear Stearns, and Morgan Stanley – are no longer in existence; they either failed, merged, or changed into depository banks.

~~~

To show the impact of deregulation, consider the underlying premise of all credit transactions – loans, mortgages, and all debt instruments. Over the entire history of human finance, the borrower's ability to repay the loan has been the paramount factor in all lending. With mortgage, this included elements such as employment history, income, down payment, credit rating, other assets, loan-to-value ratio of the property, debt servicing ability, etc.

Greenspan’s decision to not supervise mortgage lenders led to a brand new lending standard. During a five year period (2002-07), the basis for making mortgages was NOT the borrowers ability to pay – rather, it was the lender's ability to sell a mortgage to firms that securitized them.

This represented an enormous change from the past.

These new unregulated mortgage brokers no longer cared about a standard 30 year mortgage being repaid over time. In the new world of repackaged loans, all that mattered was that the loan did not come back to the originator. By contract, this was typically 90 or 180 days. As long as the borrower did not default in that period of time, it could not be put back to the originator.

It turned out that the best way to do that – to put people in houses that would not default in 90 days – were 2/28 ARM mortgages. Cheap teaser rates for 24 months, with an eventual large reset.

This monumental, unprecedented change in lending standards led directly to the key to the current crisis. It also shows what happens when we remove supervision from the financial sector. Most of these mortgage originators – nearly 300 – have since filed for bankruptcy.

~~~

Why do we have referees in professional sports? All intense competition leads to rules of the game getting tested. Refs are on the field to prevent the game from spiraling into something unrecognizable to fans.

In business, the profit incentive leads to similar behavior. We push the envelope, tap dance close to that line, and then blow past it.

Deregulation took the referees off of the field, allowed speculative excesses to flourish, and reckless short-term incentives to distort behavior.

That is Human Nature – we are competitive creatures, and we require reasonable boundaries to protect ourselves from our own worst instincts. When left to our own devices, we push the envelope, cut corners, even work against our own best interests in the pursuit of profits. Every financial scandal over the past decade – corrupt analysts, fraudulent accounting, over-stating profits, predatory lending, conflicts of interests, option backdating – are the result of a legitimate business operation pushed up to the legal boundaries, and then going far beyond them.

That is the risk deregulation brings: It encourages behavior that leads to systemic risk. In the present case, the global credit markets have frozen, threatening a worldwide recession.

The Big Picture


And in general; how can you look at a pictue of a Bush-appointee regulator taking a chainsaw to a stack of banking regulations against a background that says "cutting red tape" and claim the Bush administration didn't deregulate? What the fuck was he doing then? Deregulation is one of the main GOP policies along with tax cuts. The GOP's answer to the financial crisis has been to claim even more deregulation is needed and to try and prevent any re-regulation. We're constantly told by the GOP that regulation is strangling the economy and needs to be reversed. So given all this how can you seriously claim that Bush didn't deregulate?