themcglynn.com

02 Mar

NOT AGAIN – A “doom loop.”


Arianna: Reform Déjà Vu… Deal On Consumer Agency Nears

A “doom loop.” That’s what Andy Haldane, executive director of financial stability for the Bank of England, warned last fall would happen if serious financial reform wasn’t enacted.

Well, we appear to be a step closer to that “doom loop” with the leak this weekend of Senate Banking Committee Chairman Chris Dodd’s plan for a seriously watered-down consumer financial protection agency.

Back in June, President Obama released a proposal calling for the creation of a Consumer Financial Protection Agency that would be “independent,” with “broad authority” and the power to “combat the worst abuses in mortgage markets.” The agency, Treasury Secretary Tim Geithner said, would “have an independent seat at the table in our financial regulatory system.”

Well, that was before the banking lobby went into action. A couple of hundred million dollars later, and we’re left with this punch-to-the-gut of reform, from the top-line summary of Dodd’s plan: “the independent agency proposal would be dropped.” Seven words dirtier than George Carlin ever uttered……………………….

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