Scott Brown was on Face the Nation yesterday discussing his opposition to the financial regulatory bill. http://www.boston.com/news/nat… That’s going to be the major topic in Washington for the next few weeks.
I think that in the end there will be a compromise bill and that both sides are doing a lot of political posturing. There is some good stuff in there like required clearing and reporting for derivatives trades. This would have reduced losses in the AIG and Lehman matters.
Disclosure of Federal Reserve lending at the discount window should satisfy the “Audit the Fed” crowd.
The value of the $50 billion bailout fund is dubious. The last banking crisis was met with liquidity injections from the Fed plus rock bottom interest rates that transferred wealth from savers to bank balance sheets.
As I see it, the main problem with the bailout fund is that it is prone to misuse like using the money for bailing out GMAC or other politically connected companies. I think that would be the GOP’s best argument against this provision. The fund lowers the threshold necessary to spend taxpayer’s money on bailing out firms that took financial risks. And yes, money collected from a tax on corporations is still tax money.
The other downside is that there is a lot of cosmetic fluff (studies for this or that)in there and some congressional micromanagement of regulation.
I think the GOP is opposed to it to effect some changes. Then we’ll get a bipartisan bill. I don’t see any of the GOP objections directed at items that the Dems are wedded to.