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But it’s just a bill … March 15, 2010

Posted by WillardWhyte in Economy, Obama, Politics.
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There is an awful lot to like in the proposed legislation Sen. Chris Dodd proposed today, a bill that already sports the shine of consultation with others of a different mind, a recognition  that evoltionary change  is the wisest course and fueled by a sense of urgency.

Although I have no way of knowing this, I sense that this also is a bill owing greatly to the efforts of Sen. Bob Corker of Tennessee, who may yet vote against it even though he supports much in it. If nothing else, this is a prime example of how this system should work, even if this bill fails to pass into law and even if it does not accomplish everything we might wish for it.

And this I say even of a bill not blessed by a “bipartisan” label, for Sen. Dodd and Sen. Corker worked diligently to get there, but finally agreed to disagree. As gentlemen and, I would say, patriots. They deserve our applause.

I still suspect the Consumer Financial Protection Agency is best established as a standalone entity. If it is to start its life inside of the Federal Reserve, it will fall upon the President and the House and Senate oversight committees to make sure its budget is sound, its authority is not stiffled and its import not lost upon those in the prime seats.

And we still need to see a strong initiative in the control of derivatives trading, not allowing a needed way around the full transpaency of clearinghouses for some instruments to become a loophole that dooms orderly markets that allow investors — and systemic overseers — to have the knowledge needed to avoid bubblicious temptations and shell games.

But the proposal is comprehensive with civil enforcement teeth, includes a firm “Volcker rule” prohibition on banks or near-banks from gambling with publicly guaranteed deposits or liquidity, addresses the abuses by ratings agencies and provides a path for easier stockholder objections.

I’d love to hear what others think of this, knowing that in each caegory what the bill proposes most likely falls short of the firmness some might prefer. But to me this seems a strong stab at responsible controls designed to restore open and honest dealings while preserving plenty of room for markets to make the calls. A cop’s bill. 

Of course, the bill now is a target, with swarms of well-paid jackals ready to knaw and knaw until bone gives way and marrow is consumed. Rep. Frank promises full and open Conference to meld House proposals with this bill, should the Senate move it across the aisle. We would hope that Sen. Corker, for one, gets his day at the mike.

The rest, I suspect, will be up to the President — and us. If we want reform we had better well clammor after it now.

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