The reform of the credit agencies, which creates an office in the SEC which assigns securities to the agencies to be rated, rather than the security issuer choosing (and paying) who rates them, is an actual good reform. The Fed audit, while it is more limited than I would have liked, if done properly, should be very interesting. Financial reform is still far from sufficient, but some intelligent good stuff is being passed.
anonymous
The only thing I have to add is that we shouldn’t count our eggs before they are hatched. There are still opportunities for yet more watering down between now and when the proposed house&senate bills are signed into law or vetoed.
On the “audit-the-fed” amendment, I apply the rule that any bill lieberman votes for is one that I oppose. It should have been changed until he voted against it. Then you’ll know that there is something in there that will lead to transparency and accountability.
Dean Baker listed three reforms needed to restore the financial system to the sound footing it had in the fifty-year period after the Great Depression:
1. Break up the TBTF banks and limit their size in the future (already firmly defeated by the Millionaires Club).
2. Restore Glass-Steagal.
3. Prohibit banks from being in the derivatives business.
I would go further and say reform the “derivatives” business so that it is not gambling, but is converted to insurance backed by capital, which is what Brooksley Born argued for back in the 90s when she found out about them. Some have argued that this would make derivatives uneconomic. So be it.
Petro
@anonymous
“Some have argued that this would make derivatives uneconomic. So be it.”
Yep. “I gotcher invisible hand right here.” Sorry – grew up in Jersey. 😉
David H.
A transaction tax would at least make the obscene gambling, by criminals who should be rotting in jail, profitable for the govt as well. But then they’d just add it to the defense budget, so there is that.
anonymous
But then they’d just add it to the defense budget, so there is that.
We can’t prevent the propagandists, the weapon makers, and the mercenary companies (AKA, “contractors”) from calling it a “defense” budget, but we in the general population can stop calling it that. It’s an unproductive gov’t. jobs program, far worse than Keynes’s suggested “pay people to dig holes and fill them back in” jobs program. Keynes’s jobs program wasn’t doing productive work, but at least it wasn’t killing people, destroying countries, polluting, and wasting natural resources.
Let’s call it what it is. George Orwell’s ghost will thank us.
nihil obstet
anonymous, you’re right to object to calling it a “defense” budget, but it’s not a jobs program either. Let’s remember that the euphemism “Department of Defense” replaced the original “Department of War” in 1947. It’s the war budget.
anonymous
Let’s remember that the euphemism “Department of Defense” replaced the original “Department of War” in 1947. It’s the war budget.
Calling the jobs program a “war” budget assumes that there is some military force that is 1) threatening the U.S. (there is none) and 2) that this force is fighting the U.S. (again, there is none).
Suppose that you saw a 300-lb NFL lineman attack a girl scout, who “had it coming because she gave me a look.” We would call that an assault. Suppose that the girl scout, as she is being pummeled, gets in a kick. It is still an assault. Some people want to say, “Look! She kicked him! That’s a fight! She gets what she deserves.” The U.S. military is not at war. It is engaged in an illegal occupation.
It is a jobs program. Welfare for the right wing voters (and the owners of the companies that make weapons and military supplies).
Suppose that the hundreds of billions that is being spent on weapons, supplies, and mercenaries was instead donated to the governments of the occupied countries. How many hours would pass before the right wing (both democrats and republicans) would offer up a bill to end support? (None, because if bush&cheney had offered to cut the budget for weapons, supplies, & mercenaries and had then proposed to offer the equivalent amount of money in direct aid, the right wing in congress would have rejected the proposal.)