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Originally Posted by dc_dux
ace...I am actually impressed that a free market, "no regs" guy like you is willing to acknowledge that the financial services modernization bill that effectively repealed most of Glass-Steagall was responsible for the abuses of the last 10 years.
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I understand debate technique and the use of hyperbole to emphasize a point, but to suggest I am a "no regs" guy is a bit over the top. I am not sure if you actually believe your summation of my views or if it is something else. Which is it?
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IMO, it was compounded by Bush's SEC chairman turning a blind eye to those abuses.
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I would not characterize investment banking activities as an abuse. There are winners and losers. the dramatic shift in market conditions was compounded in my view by government, and there was certainly no legitimate reason for the government to selectively bailout some and not others.
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And the economy was further adversely impacted in terms of debt/deficit by taking a budget surplus (and paying down the debt) and instead of continuing that policy, enacting the 01 and 03 tax cuts (at a cost of $1 trillion) that provided little or no stimulus...and an unnecessary invasion and occupation of Iraq (at a cost of another $1 trillion before its over).
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This goes off point. The federal deficit had virtually nothing to do with the financial crisis. It is very common for an economy in war to increase its debt. And deficit spending as a percentage of GDP was in line with historical averages. Even with the tax cuts, taxes collected went up. The real problem with the deficit is spending and the accounting tricks used to raid social security.
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But now that you recognize the impact of the de-regulation of the banking/financial services sector, are you ready to re-regulate?
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Again, I am not clear on what your intent is in the way you characterize the issue. Banks were never de-regulated, I would say they were wrongly regulated. The government did not let the hens run free, the government let the wolves into the hen house thinking it was a good thing.
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The House passed a bill (with zero Republican votes) late last year that the WH supports.
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If true it should have passed and become law, the WH had a super majority.
I currently support reinstatement of Glass-Steagal, past Fed chairs support it, and there are some conservatives who do as well. If the WH supports it, I think Obama could get it done. I think this would be a major win for him, and could re-set the tone in Washington. I have no interest in a repeat of the financial crisis or a double dip recession. Now is the time to act.