Bruce Bartlett argues that reading the health care bill is a waste of time. Not only is it all written in legalese, but also, many of the provisions simply alter sections of other bills, so unless you have some sort of hyperlinked database, much of the language is meaningless.
The same could be said of the draft financial services bill that has started circulating. I have it, but haven't looked at it yet because a friend who has--and is a security lawyer--says that it's similarly impenetrable. His thoughts:
Did I mention it is 1136 pages?
I have noticed three things from a first look . . . :
1) The bill would create a separate "Agency for Financial Stability" rather than vesting everything in the Fed (no word on whether it will be brought to you by the same people who brought us the DHS...)
2) On the regulation of hedge fund advisers, I note that they have clarified something that was less clear in prior draft bills, which had caused some agita--namely, this bill would clarify and beef up the confidential nature of the sensitive information that hedge fund advisers would be required to file with the SEC on a regular basis
3) Those same hedge-fund regulation provisions include an exemption for venture capital advisers. The consensus is that such an exemption will be enacted, for one reason: "Nancy Pelosi's district."
You may want to focus on this as the most important part. Isn't the FDIC's current role in resolving failing banks the best-performing part of our current financial regulatory system?
This is the passage to which he referred:
Senator Christopher Dodd proposed creating a single U.S. bank regulator and stripping supervision from the Federal Reserve and Federal Deposit Insurance Corp. in legislation aimed at preventing a repeat of the credit crisis.
Dodd, chairman of the Senate Banking Committee, would eliminate the Office of the Comptroller of the Currency and the Office of Thrift Supervision and fold the Treasury Department units into the Financial Institutions Regulatory Administration, according to draft legislation released today in Washington.
"Our proposal will replace the myriad government agencies that failed to rein in risky schemes with a single, accountable federal banking regulator," the Connecticut Democrat said at a news conference.
This does indeed seem sort of crazy to me, and not just because the FDIC has indeed done a good job. The agency works so well because it can control its risk exposure--banks that want the safety net have to abide by its rules, mostly. Stripping that away introduces moral hazard to both the banking system, and the government--whoever this new central regulatory authority is, another agency will pay for its mistakes. It also seems like this would make the FDIC's tricky job even trickier.