WASHINGTON - The Bush administration is proposing a sweeping overhaul of the way the government regulates the nation's financial services industry from banks and securities firms to mortgage brokers and insurance companies.
The plan would give major new powers to the Federal Reserve, according to a 22-page executive summary obtained by The Associated Press.
The Fed would be given broad authority to oversee financial market stability. That would include new powers to examine the books of any institution deemed to represent a potential threat to the proper functioning of the overall financial system.
The proposal, which will be outlined Monday in a speech by Treasury Secretary Henry Paulson, is certain to set off heated debates within different sectors of the financial services industry and in Congress, where some Democrats are likely to complain that the proposal does not go far enough to crack down on abuses.
By MARTIN CRUTSINGER, AP Economics Writer - yahoo economic news, Sat March 29
The article above illustrates one more example of how George W Bush, more than any President I can recall, is determined to consolidate as much power as possible at the federal level. This example is crazy because it represents greatly expanding the powers of the Federal Reserve - an unelected, unaudited, secretive group. What's even more crazy is that article is probably right in saying that the Democrats will object that it doesn't go far enough!
So, the contrast grows clearer day by day -- G W Bush and the belt-way people seek to bolster 'the Fed' while Ron Paul campaigned to eliminate it altogether.
Unfortunately, there will be no last laugh on this one - because it's no laughing matter.
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4 comments:
This is very unfortunate. The markets need a good deflating but who really wants to let that happen. In order for this to happen (not going to mention how we go here) the whole of the US needs to have the fortitude to deal with the effects of a free market in action. That is the loss of jobs, the loss in value in investment, the collapse/merger of companies.
The truth is that people don't want that to happen. The want the benefit of Free Market (crazy money due to risky deals) but not the penalties. Bear Stern and other deserver to get spanked for the risk positions they took.
It is inevitable that this is going to happen. I don't blame the Bust Administration, they are simply responding to the 'public' outcry to make life perpetually better for them at any cost.
Ben - you are exactly right - a free market system is self-policing (Enron) and self-correcting. Good business gets rewarded and bad business gets punished. In this case, there has been so much bad business at the same time - and in such critical sectors - that it is hard for the administration to just sit back and watch it fall apart - but that would ultimately be the best solution. I blame the Bush administration for expanding the powers of the FED - the SEC already regulates and audits banks - why add another layer? BTW I go visit our friends on the 12th.
I am jealous. Did you hear about the upcoming wedding?
Are you presenting or are you just visiting?
I blame all politicians and media for creating a near hysteria that has called for a public outcry for this new set of powers. The election year always creates the worst policy. The Dems are saying that he isn't doing enough. Silly.
Ben
Just a tourist in the country. Yes, heard about the wedding. Would have liked to have helped but was broke after Christmas.
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