Your Financial Back, Who Has It? Republicans or Democrats

If you were tired of the Health Care Reform political quagmire and disinformation, then thank God the Republicans and Democrats have brought out their Spring-season political issue: Financial Markets/Industry Reform. It was probably fortunate for some Americans that the Health Care Reform bill was passed before the political football was put into mainstream public play; because Financial Reform will surely make you ill and thus in greater need of medical assistance. We can also be thankful that the political pros left this issue almost unattended to until now, so that the good weather season will allow more of the public to avoid as much of the media’s non-substantive reporting as possible.

So who then has your back on this issue?

Before you jump to your answer, and I realize that a large number of you already have, it would be a propos to consider what the basic positions and proposals on both sides are. For those of you who have already answered then I would assume that:

• you already know the proposals that each side has presented,

• have carefully considered and compared the different proposals on their merits and objectives,

• have ascertained which proposal has the most likely expectations of providing both a prudent and reasonable regulatory environment for the US financial markets as well as sound means for protecting the American investors and tax-payers from irrational, irresponsible and illicit behaviors/activities on the part of financial institutions.

H’mm! Do I really think that people who have already chosen their sides on this issue have thought that much about them? I think not. But I am sure that no matter which side you favor that the political party and politicians that represent you are sufficiently well qualified, knowledgeable and uninfluenced by special interest groups to be relied upon to fulfill their legislative duty in a manner to serve your interests admirably. I, on the other hand, am surer that neither the Democrats nor Republicans know how to pour water out of a boot with the instructions on the heel than know what they should do to create a governmental regulatory environment for the US financial markets. Especially their ability to setup a regulatory framework that will safeguard the American public from the risks and dangers of the financial industry’s corporate mindset for their profits at any price, and the self-interest of their executives for their own stellar compensation packages.

What do the Democrats propose? Their legislation would among other things create a liquidation mechanism for large financial firms that get into trouble. This would create a $50B fund for institutions that fail, but are “to big to fail”. So it include provisions that don’t cause financiers to be any more worried about failing than they were previously; and thus they can continue to take big risks and rely upon someone else to bail them out. While it is not explicitly the tax-payer who pays under this proposal, as the fund is created out of industry funding; it is ultimately paid for by the American people. Since the last time I checked the only place that anyone, including the government and financial institutions, gets their money is from the American people.

The Democratic proposal also imposes some regulatory restrictions and oversight on the heretofore unregulated derivatives market, and provides some consumer protection rules in the credit arena.

Now let’s consider the Republicans’ alternative proposals. Republicans want to not do what the Democrats propose. They are convinced that the Democrats are wrong, but details on their own remedies for securing the economy for the American people are woefully represented in the media as far as I have seen. Now I will admit that this may be due to my own inattentiveness, but should it really be that difficult to find or hear something substantive on their proposals? I do rest assured however that the Republican approaches will be as unimaginative, ineffective and unsuccessful as what the Democrats espouse; and much more likely to be influenced by the irreplaceable and brilliant minds that come the Financial companies who produced the near-economic collapse that us lucky tax-payers are privileged to pay for.

But don’t despair! The mid-term elections will without a doubt bring out the quality of politicians that America needs to bring about a resurgence in fiscal responsibility and economic security that we have lacked for decades under both Republican and Democratic administrations, Congresses, and voter sentiments.

I wonder if the public would have the “common sense” to seek out candidates who realize that they do not know how to address the problems in the financial markets, but who are willing to seek out individuals who can present understandable and compelling approaches that will achieve an improved regulatory environment that benefits the American public.

Oops, I forgot! This would require both uncompromised politicians and an electorate that thinks enough to dismiss the strident and partisan propaganda from both the Democrats and Republicans intended to serve their party’s interests above any value to America.

It’s too bad too, since as usual the concepts for effecting viable financial reforms are not actually that hard to develop.