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Institutional Bailouts: All Regulation, No Reform July 9, 2010

Posted by seeineye in : Politics , trackback

by Rep. Todd Akin (R-MO)

How do you fix a problem? Well, in Washington, there is a sure-fire solution to any crisis: pass reactionary legislation without knowing what is in it to show you really “care” about the problem. Then, claim the problem is solved. Wait until the next crisis. Repeat.

The current crisis is big, overly exposed financial institutions; some of which have taken enough risks that they are now insolvent. Unfortunately, the regulatory reform (a Democratic metaphor for regulatory expansion) being considered by the House and Senate in response to the recent financial crisis will not solve the problem.  In fact, it may make them worse by cloaking the real issues with new regulations but without addressing root causes. These misguided political ambitions are especially obvious in H.R. 4173, the Restoring American Financial Stability Act of 2010.

Here are just a few examples of why H.R. 4173 is very effective at expanding government regulation but very ineffective at providing for the substantive reform needed to fix the failure points of our financial institutions:

Contrary to claims made by the Democratic majority:

The short-term political benefits that the Democrats hope to reap from this ill-considered measure will cost U.S. firms in the global marketplace, leaving them unable to create stable jobs for American workers.  The American people deserve both a better process and a far better policy outcome from their elected representatives.

In his first State of the Union address President Obama rebuked Republicans for opposing big-spending. He told us that saying “No” may be good politics, but it’s not good leadership.  Well, saying “yes” to bad policy isn’t good leadership either, Mr. President.  The 2000 plus page H.R. 4173 is just one more example of the Democratic majority’s attempts to grow government, not fix problems. Not only does it fail to address the root causes of the financial crisis, it’s bad for the economy, it’s bad for business, it’s bad for jobs, and it’s bad for America.

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