Letter to the Editor
From Issue 752
By: Robert E Martin
26th July, 2012
Actions regarding responsible financial dealings are being stifled by U.S. House GOP leaders, suggesting that the party's true manifesto is: “Greed - Our Platform.”
Consider the $3 billion derivative trading loss several weeks ago by JP Morgan Chase. That might have been avoided if Republicans hadn't denied funds to put referees into the money game.
A spending bill recently released by Republicans seeks to slash the budget of the Commodity Futures Trading Commission - which should be policing potentially toxic deals. The GOP also wants to deny funds to the Securities and Exchange Commission that would give teeth to the Dodd-Frank financial reform bill. Republicans also want to limit the Internal Revenue Service's ability to seek out wealthy tax cheats.
America is being driven down a slippery speculation road - which can increase commodity prices such as in oil - toward another recession. Consequences will be far greater for the middle class and poor than well-heeled gamblers who will seek “too big to fail” federal bailouts.
Chris Thompson * Freeland
Editor's Reply: We at The Review also believe that financial reform and attempts by so-called Congressional leaders to gut whatever reforms were contained in the Dodd-Frank financial reform bill will be the defining issue of this year's election cycle.
For the last two years Wall Street's legion of lobbyists have been trying to get the Federal Reserve to write the 'J.P. Morgan loophole' into law. Senator Jeff Merkley managed to navigate controls into high-risk banking with inclusion of The Volcker Rule firewall into the Dodd-Frank bill, which protects taxpayers by assuring that should Wall Street's bad bets blow up, taxpayers do not end up footing the bill. Gambling should happen in hedge funds, not in the federally insured banks that families and small businesses depend upon.
Watch for an in-depth analysis of how the current Congress is caving into Wall Street in our next edition.