There’s one thing you have to admit about President Obama’s plans for revised financial industry regulations: they do address the most important problems. Nonetheless, prospects for serious reform are disappearing.
The opaque derivatives market, crumbling bank oversight and totally unregulated hedge funds – Obama had solutions for all of them at the ready and most of them pointed in the right direction. But that’s just about the only positive thing that can be said about Barack Obama’s plans at present. For one thing, most of them are just too fuzzy.
Furthermore, they will no doubt be watered down as they make their way through Congress. The gravest shortcoming, however, is the half-hearted attempt at reforming oversight. The United States already has any number of agencies watching over the markets but in the end every one of them failed to recognize and stop this crisis.
Instead of seeking to unravel the thicket of agencies and the confusing jurisdiction of each, Obama now wants to create new ones. All of them are to be overseen by the Federal Reserve and a still to be created “super regulator” that is supposed to give early and adequate warning of systemic risks. Whether this new model will function any better than the old one is by no means certain. It won’t help to merely have more experts keeping watch. What’s really necessary is a better understanding of just what is it a regulator does.
The U.S. plan also does nothing to reform the international financial architecture. On the contrary, it’s presently a one-sided effort that will hinder unified global regulations rather than helping to make the effort international.
In addition, it would appear that prospects for true and comprehensive reform have become more remote. When banks and politicians were both staring into the abyss last fall, they were all in agreement that new and more rigorous regulation was necessary. Even the ideological differences in regulation methods between Great Britain and continental Europe seemed to be disappearing.
But now that the financial system seems to have taken a step back from the abyss, the old disagreements have quickly reappeared. When the European Union begins talking about regulating, Britain slams on the brakes, apparently feeling strong enough now to make it without government regulations.
So Americans and Europeans have to hurry. They must come to international agreement on the current proposals and implement them as quickly as possible. If they don’t, everyone will soon forget that things really do have to change.
change to what?
regulation?
what you fail to mention or maybe realize is that the lobbyists in wash control congress.
and corp lobbyists do not want regulation of any kind. they understand the road to profits and huge bonuses is deregulation.
this is all an act to convince the america voters that their politicans work for them.
nothing could be farther from reality.
in american it takes huge sums of money to win an election on a federal level.
that money comes from corporations and their lobbyists. politicans dance with who brung them.
ie the corporations and their lobbyists.
wait until you see what control the insurance companies and the drug companies have on proposed universal health care in america.
americans dont consider health care a right. you are on your own in america with health care.
american is about wars for profits and being a super power in the world and will pay any price to remain a super power. ie national ego thing.
it is a bully mentality. the problem with being a bully is what happens to bullies in time.
americans are about to find out that super power status has it price. ie bankruptcy and the rapid decline of the middle class.