That’s not to say a number of the industry’s concerns are not valid. But their declarations of good-faith negotiation are undercut by the cynical and intellectually dishonest way in which they have chosen to play the Washington game.
Having complained, for example, that the uncertainty surrounding financial regulatory reform was depressing economic growth and job creation, their big beef now — parroted, obligingly, by every Republican on Capitol Hill — is that regulators are moving too quickly to clarify policy and issue regulations.
Having bitterly resisted efforts to consolidate agencies and remove overlapping jurisdiction, their new complaint is that the regulatory structure is cumbersome and has no clear lines of authority.
The industry warns endlessly that more regulation and higher capital standards will drive business to more hospitable regulatory environments overseas — and then turns around and pushes to weaken overseas regulations even further.
Despite its professed concern for the quality of regulation, the industry declines to take a stand against Republican efforts to dramatically cut funding for financial regulatory agencies. Nor has it used its influence to overcome the determined opposition of Senate Republicans to anyone the Obama administration might nominate to the top jobs in those agencies, many of which have been vacant for months.
For those of you who just tuned in, there are two heavyweight fights going on between the industry and the regulatory reformers.
One fight concerns trading of swaps and other derivatives, which until now was either loosely regulated or not at all. Under the new Dodd-Frank law, this trading is supposed to migrate to regulated exchanges where prices will be posted, position limits will be set, traders will be required to post collateral and dealers will have to maintain minimum capital requirements.
In Congress, banks and other dealers bitterly resisted these common-sense reforms for one simple reason: They would cut into what have been sizable profits. Having lost that battle, they are working overtime to weaken and delay the rules issued under the new law, once again claiming that it is not they who will suffer from this government overreach, but farmers and manufacturers and other “end users” who will have to pay more to use derivatives markets to hedge their business risks.