Chamber Faces Off with Dodd-Frank Backers Over Free Trade
In a column written for the Financial Times, George Osborne, British finance minister, and Jun Azumi, his Japenese counterpart, warned that the U.S. regulation could make it “more difficult, costlier, and riskier for countries to issue and distribute debt.”
According to critics, the regulation could increase borrowing costs for foreign governments, limiting their ability to raise funds in government bond markets. The rule includes an exception for U.S. Treasuries, but excludes non-U.S. government bonds, raising concerns among foreign governments of double standards. The Chamber said that the rule could violate free trade obligations because it would cover foreign sovereign debt, while exempting U.S. government bonds. Foreign banks operating in the U.S., or offering services to any U.S. residents, would also have to comply with the rule.
“International rejection of the Volcker Rule continued after the passage of the Dodd-Frank Act and in the two and a half years since the passage of the [act], no other nation has enacted legislation or regulations analogous to the Volcker Rule,” said the Chamber in its statement. The letter also warns that the rule could prompt retaliation from foreign governments.
In his statement, Levin also explained his position on proprietary trading by banks whose deposits are federally insured.
“The principle behind the Merkley-Levin provision implementing the Volcker Rule is simple: If you’re going to place risky bets for your own profit, you can’t do it with the backing of government-insured deposits. That’s just common sense, and the big banks and their allies should stop their foot-dragging and obfuscation. The time for delay is over; now it’s time for a strong Volcker Rule and vigorous enforcement,” said Levin in the statement.
Sens. Carl Levin and Jeff Merkley (D-Ore.) introduced their amendment to the Dodd-Frank Act in May 2010 to “restrict proprietary trading at banks and other large, important financial institutions” that use the money of taxpayers. The Huffington Post reported that, shortly after the senators’ announcement, Volcker declared his support of the amendment in a personal letter he sent to the two senators and praised their effort to “clarify and enhance the proprietary trading restrictions contained in the Dodd Bill.”
Proponents of the Volcker Rule blame proprietary trading for exacerbating the financial crisis by encouraging risky investment among banks.
The U.S. Chamber of Commerce became the first business group to effectively challenge government regulations invoking the law in 2005. Since then, it has succeed in having the United States Court of Appeals for the District of Columbia toss out three financial regulations.
Even if the trade representative’s office declines the Chamber’s requested review, the letter could open the gates for legal challenges against the rule.
Woodward: ‘There’s a Civil War in the Democratic Party’, DEC 12, 2012 • BY DANIEL HALPER
http://www.weeklystandard.com/blogs/woodward-theres-civil-war-democratic-party_666154.html
The takeaway here is the response from Levin, that somehow the parasite class can prevent fiscal crises from occurring with no more than stroke of its collective pen. The arrogance behind this, while almost epic, is understandable given the combination of ignorance and apathy among an electorate that gives gasbags like Combover Carl free reign to do almost anything they want.
I see some undefined congressional gibberish here “ban on proprietary trading under the ‘Volcker Rule’”. What’s “non-proprietary trading”? What, exactly, is or could be the “Volcker Rule”? Didn’t he move on back around 1980… or is this another Volcker?
Dodd and Frank were among the chief perpetrators of the mortgage/financial markets melt-down, and their legislation does nothing to correct the abuses they demanded. At the same time, the US Chamber of Communists has long since ceased to be a supporter of honest free market capitalism, and turned into a crony collectivism propaganda hot-house: demanding subsidies; an ever-increasing flood of cheap, young, pliant foreign labor with flexible ethics; anti-competitive measures.
But if it “violates our World Trade Organization and free trade agreement commitments” it’s very likely good, since neither the WTO nor the so-called “free trade agreements” have anything to do with actual, you know, free and honest international trade. Look at what they did when Red China was dumping their cheap steel? WTO jumped in to try to penalize the USA for our penalties for the dumping, but did not threaten to penalize Red China. When we brought up the VAT kick-backs and tried to pass US tax legislation to neutralize them with compensating measures, the WTO threw a hissy fit.
What’s the average import tariff in Red China? In Europe? The last I saw any word on it, our average was between 2% and 8% (with zillions of exemptions for specific chemicals and products by the way of pork for particular congress-critters’ specific campaign donors), while our “trading partners’” import tariffs were running about 48%. And that’s in addition to gimmicks such as the notorioius French foot-dragging and unavailability of officials to conduct inspections at the ports, Red Chinese and Indian blocks on imports of US car parts (but eagerness to steal our latest defense, nuclear power, and telecomm hardware and software).
We should have bolted from the WTO back in 2003, or before, as soon as we saw the game was rigged against the USA.
Apologies; I should have read further.
“The Volcker Rule – a rule restricting U.S. banks, or any institution that owns a bank, from trading on a proprietary basis (trading using the firm’s own funds as opposed to its customers’ money) – will be implemented as part of the Dodd-Frank Act.”
Yah, sounds like the old “Regulation Q”. It’s a bad attempt to divert attention from Dodd and Frank and Waters’ demands for ever lower standards for mortgages, by pointing the finger at “corporations”, instead.
Its only proprietary money if the banksters make money. if they lose it becomes a national crisis and we all have to chip in with money we ain’t got either.
Still, I might go along if the board of HSBC was jailed, for life, for laundering money for Iran and for the Narcos in Mexico. Tell me what would happen to one of us if we laundered money for Iran? Jail? a bullet?