Regulation

The Washington Post is reporting (see article here) that the House-passed financial regulation reform bill would give enforcement power over the internet to the Federal Trade Commission. Specifically, it “would allow the FTC to issue rules on a fast track and permit the agency to impose civil penalties on companies that hurt consumers.”

Everyone’s favorite line from the movie “Casablanca” is when Inspector Renault says to Rick (as he collects his gambling winnings), “I am shocked, shocked to find gambling going on here.”

In the case of the Commodity Futures Trading Commission, I am actually shocked, shocked that the CFTC just gave the go-ahead to idea of gambling on the future prospects of movie box office receipts.

I think there will be a deal on financial services reform, or Wall Street reform as the White House now calls it.

But first there has to be the requisite Kabuki dance.

According to Wikipedia, “in common English usage, a Kabuki dance is an activity or drama carried out in real life in a predictable or stylized fashion, reminiscent of the Kabuki style of Japanese stage play.”

Unlike in health care reform, where the Kabuki theater pointed towards conflict, this play leads, in my estimation, towards resolution.

It used to be said that what is good for General Motors is good for America.

And for much of the last century, that assertion was basically true. Economic policies that helped make General Motors the number one car maker in the world were also good for the country.

The American people don’t like bailouts, unless it is they themselves who are getting bailed out. And even then, being bailed out leaves a bitter taste in one’s mouth.

TARP has popularly been described as a bailout, and maybe it was. But without TARP, the financial system would have completely crashed, and believe me, millions of Americans would have come to the government, asking for their own personal bailout.

I’m crossing my fingers that this time Congress gets it right.

After the trauma of the past few years, it is too important that this legislation not be hijacked by petty politics, cheap populism or industry lobbyists. So, three wishes for regulatory reform:

A bipartisan bill

With news that financial reform legislation is headed for the Senate floor, it is time to officially scrap the administration’s proposed Financial Crisis Responsibility Fee—the “bank tax.” Now, before the populists with pitchforks and torches start after me, let me emphasize that, sensibly, the TARP law says that the taxpayers must be given a path to recouping their losses.

Two weeks ago, Senate Banking Committee Chairman Chris Dodd (D-CT) released the most recent version of a proposal to overhaul regulation of the financial sector. The introduction of this bill into committee represents what is likely the final push toward accomplishing a rearrangement of financial regulation (FinReg) this year. With health care policy largely off the table after recent passage, the Administration has explicitly signaled that passage of a bill along these lines is a major priority.

Two weeks ago, Senate Banking Committee Chairman Chris Dodd (D-CT) released the most recent version of a proposal to overhaul regulation of the financial sector. The introduction of this bill into committee represents what is likely the final push toward accomplishing a rearrangement of financial regulation (FinReg) this year. With health care policy largely off the table after recent passage, the Administration has explicitly signaled that passage of a bill along these lines is a major priority.

Earth Day (April 22) is only six weeks away, and I just noticed that the EPA recently updated air quality data for 2008 and thought it was worth featuring now in anticipation of the 40th anniversary of Earth Day: Predictions made around the time of the first Earth Day in 1970: “Air pollution is certainly going to take hundreds of thousands of lives in the next few years alone,” Paul Ehrlich in an interview in Mademoiselle magazine, April 1970. Ehrlich also predicted that in 1973, 200,000 Americans would die from air pollution, and that by 1980 the life expectancy