Home
/
RELIGION & LIBERTY ONLINE
/
Dodd-Frank: The Other Serious Threat
Dodd-Frank: The Other Serious Threat
May 30, 2024 9:48 AM

At least es at us head on. The greater legislative threat may be the one that most Americans have never heard of. Economist Scott Powell and Acton friend Jay Richards explain in a new piece in Barron’s:

While Obamacare received more attention, the Wall Street Reform and Consumer Protection Act, also known as Dodd-Frank after its Senate and House sponsors, … unleashed a new regulatory body, the Consumer Financial Protection Bureau, to operate with unprecedented power.

Dodd-Frank became law in 2010 and is supposed to avert the next financial crisis. Yet banks are still too big to fail and Fannie Mae and Freddie Mac remain wards of the state, while the CFPB has been given sweeping authority over consumer credit and other financial products and services that played no significant role in the crisis of 2008.

Powell and Richards then offer some specifics:

The bureau wields a variety of enforcement tools and sanctions, such as “cease and desist” orders that can be imposed without giving time for targets to appeal. For those who knowingly violate a law or rule, the CFPB can impose penalties of up to $1 million per day, with the ability to demand “reimbursement” for the costs of enforcing the penalty.

The CFPB is reversing decades of cooperation and the presumption of good faith between financial institutions and regulators, turning bank examinations into prosecutions.

The new bureau is taking part in drafting some of the 400 rule-makings required by Dodd-Frank, and in rewriting existing rules that have been successfully enforced by seven other agencies. Exposing so many rules to creative regulators will create confusion and uncertainty, especially since the new rules can flout existing precedent and interpretations by the other federal agencies. The likely result: higher costs, less credit, jobs not created, and a recession without end.

It gets worse:

The 2008 collapse and government seizure of Fannie and Freddie, with some six million related foreclosures, should have curbed politicians’ appetite pelling banks to lend to risky borrowers. But the Consumer Financial Protection Bureau has begun coercing banks to lend and underwrite mortgages to unqualified minorities. The CFPB is even extending its new regulatory authority to the consumer credit bureaus by requiring new scoring models for blacks and Hispanics that boost their relative standing.

The bureau is the first regulatory body to use social media to post unverified plaints on its Website. plaint at the Better Business Bureau is damaging, but the effect of hundreds plaints posted on “an official Website of the U.S. Government” can be ruinous. plaints are raw meat to lawyers trolling for the next class-action lawsuits. The CFPB should not be a conduit for Democratic party funding and payback to lawyers who are big contributors.

The piece concludes with suggestions for killing the beast:

In the short run, the Senate can hamstring the agency by summarily rejecting the recess appointment of Director Richard Cordray during the next session of Congress.

But challenging Dodd-Frank’s constitutionality — as is being done in a federal suit filed in June — is the best defense for the long term. It should be clear to some court that the CFPB lacks the checks and balances required by the separation-of-powers clause.

Most other independent federal agencies are governed by missions and funded by Congress. The CFPB, in contrast, confers power on a single director for a five-year term and dodges the usual congressional oversight. The bureau is funded by, and located inside, the Federal Reserve, yet outside the review of either the Fed or Congress.

Comments
Welcome to mreligion comments! Please keep conversations courteous and on-topic. To fosterproductive and respectful conversations, you may see comments from our Community Managers.
Sign up to post
Sort by
Show More Comments
RELIGION & LIBERTY ONLINE
Monitoring African aid and development
Ecumenical News International (ENI) relates the launch last month of a new initiative in Africa, designed to “to mobilise a strong African voice in development.” The effort is called African Monitor and is led by the Anglican Archbishop of Cape Town, South Africa, Njongonkulu Ndungane. Anyone who spends much time at all looking at the economic development situation in Africa quickly realizes the lack of independent, nongovernmental, native voices. As African Monitor states, “This African civil society voice can thus...
The limits of policy
“Be fruitful and multiply,” the Book of mands. Unfortunately, many modern nations are on the opposite track. Once worried about a phony “population bomb,” countries as diverse as Russia and South Korea are now wondering if they will shrink into irrelevance. Kevin Schmiesing looks at the cultural, religious and economic forces that produce healthy, hopeful societies. Read mentary here. ...
Kyoto hypocrisy
EUObserver: “New figures released on Thursday have revealed that the EU is falling far short of reaching its emissions targets under the international climate change treaty, the Kyoto Protocol.” HT: Townhall C-Log ...
Great Lakes wind power
A three-day meeting is scheduled to begin tomorrow in Toledo, Ohio, and is set to discuss the possibility of putting wind farms on the Great Lakes. The session is sponsored by the U.S. Fish and Wildlife Service and the Environmental Protection Agency among other groups, and will include conversations about “how to protect birds, bats and fish from the windmills.” According to the AP, wind farms on the Great Lakes would include “rows of windmills” that “would tower as high...
Fight Club quote of the day
“I’m not in any way a violent person, but I enjoy getting out there and fighting when I can.” –Blake Cater, 22, of Burlington, NC, who videotapes backyard fights with his friends and broadcasts them on the web. More on Cater and the amateur fighting video phenomenon from today’s Washington Post, “On the Web, Punch and Click,” by Paul Farhi. Also check out a mentary of mine, “Our Slap-Happy Slide into Techno-Violence,” in which I argue, “The market must be...
Supreme Court update
The Supreme Court is in the midst of its busy season. Important decisions recently handed down include the death-penalty case, Kansas v. Marsh, and the campaign finance case, Randall v. Sorrell. Jonathan Adler offers an interesting analysis of the decision in a pair of cases, Rapanos v. United States and Carabell v. United States, which involved the the scope of the federal government’s regulatory jurisdiction over wetlands. Given the Court’s ambiguous record of protecting private property rights (see Kelo), Adler’s...
A long, hard road
In today’s OpinionJournal Clint Bolick, president and general counsel of the Alliance for School Choice, gives an overview of the state-by-state successes of school choice advocates. One of Bolick’s important observations is that the move for increased choice petition in education is increasingly ing bi-partisan. Politicians who have been attached to the education establishment are beginning to realize that school choice is one of the most hopeful options available for those who are the neediest and the poorest. Those who...
Brunner v. Barth
Related to Stephen’s last post, the result of this Googlefight speaks for itself: Emil Brunner versus Karl Barth. By the way, Wipf and Stock Publishers have reprinted the classic exchange of the Barth/Brunner debate, Natural Theology: Comprising “Nature and Grace” by Professor Dr. Emil Brunner and the Reply “No!” by Dr. Karl Barth. ...
Protestants and natural law, part I
So, why don’t Protestants like Natural Law? The short answer is: there isn’t a short answer. So starting now, and continuing for who knows how long, I plan to tell the story of the Protestant struggle over natural law, plete rejection by Karl Barth in the 1930s to the recent hint of renewed interest among Protestant intellectuals. My view is that natural law is a forgotten legacy of the Reformation — one that contemporary Protestants desperately need to rediscover. Along...
Use GoodSearch, support the Acton Institute
GoodSearch is a Yahoo!-powered search engine that allows you to designate a recipient charity of your choice. Once you pick a charity, each time you use GoodSearch that group will receive one cent. GoodSearch was founded by a brother and sister who lost their mother to cancer and wanted to find an easy way for people to support their favorite causes. The Acton Institute is now an option and can be designated as your GoodSearch recipient. Simply type in “Acton...
Related Classification
Copyright 2023-2024 - www.mreligion.com All Rights Reserved