Hapless Federal Regulations

Our current banking and financial service laws and regulations didn’t prevent the Meltdown of 2008 or Bernie Madoff, but the Community Reinvestment Act, HUD anti-discrimination regulations and lawsuit extortion against banks caused lending institutions to make bad loans. The inattentive Fed allowed financial institutions to expand their leverage to an unsustainable 30 to1. ACORN and HUD extorted banks into giving mortgages to un-creditworthy borrowers and those mortgages are still defaulting. I wonder if Freddie and Fannie are still bundling these for sale as mortgage-based securities. Many no-doc mortgages went to minimum –wagers and illegal alien day laborers.

Sarbanes Oxley did not encourage any companies to remain in the U.S. Lots of companies relocate overseas. The bulk of U.S. businesses dutifully complied with Sarbanes Oxley and quietly passed the costs on to their customers or vendors. No U.S. businesses were caught violating the law. It was a useless expense and we missed the mark. The proposed banking and financial services regulations do not include a rescinding of the Community Reinvestment Act or HUD Regulations that caused the 2008 Meltdown, so should banks continue to comply with the CRA, or take Bernanke’s advice to now only lend to credit-worthy borrowers ? Should they keep making bad loans because the CRA hasn’t been repealed ? Are ACORN lawyers now gearing up to sue lenders again for not lending to the poor ?

Our newly proposed finance laws do nothing to repeal the Community Reinvestment Act There are no Bills proposing that we close the loopholes that allow hedge fund owner / campaign contributors to pay a 15% capital gains tax on their earnings instead of paying 35% regular income tax. There are no new regulations requiring firms like AIG to set aside reserves for credit default swaps. There is nothing in this Bill to limit financial firms from returning to their leveraging ways, or stating clearly that the Treasury and Fed will not bail them out from the next meltdown.

Congress needs to temper the “parade of victims” method of legislation with a website that allows the rest of us to let you know the real problems we uncover and give us a chance to give you the priorities we would like for you to address. Starting with Bush 1, we received a raft of laws imposed on businesses that were not helpful. The enactment of these laws resulted in little or no benefit to employees compared to the cost. We were protected from polygraphs, entitled to 12 weeks unpaid leave and our anti- discrimination laws were allowed to morph into nightmares like the Meltdown. This alone has resulted in putting us on the hook to restore global banking liquidity to the tune of $25 Trillion. That’s too high a price to pay just to maintain evolving anti-discrimination laws that result in reverse discrimination findings. We are chasing our tail and going broke in the process.

The EPA has blocked drilling for oil and gas, kept gridlocked cities from expanding their road systems and will make our electric bills go up 5 fold unless we stop them.
We are not in a good place to bring our manufacturing back from China, Mexico and Indonesia. We have a “new normal” that suggests that if we want to survive, we will cut government spending by 50%. We are following the Japanese and most of Europe into the economic abyss of national bankruptcy.