Originally Posted by Villages Kahuna

Many of you know that I'm not against ALL government regulation, as many of you say you are. What I am against is unnecessary, over complicated and obviously ineffective regulation produced by self-serving or lobbyist-motivated members of Congress.

Consider the Dodd-Frank law of 2010. Its aim was noble: to prevent another financial crisis. Its strategy was sensible, too: improve transparency, stop banks from taking excessive risks, prevent abusive financial practices and end “too big to fail” by authorizing regulators to seize any big, tottering financial firm and wind it down. I supported these goals at the time, but I expressed serious doubts that Congress could write legislation which would effectively regulate profit-motivated Wall Street and the big banks. I said at the time that I didn't believe that Congress was anywhere near smart enough to do that.

Dodd-Frank turned out to be far too complex, and is becoming more so. At 848 pages, it is 23 times longer than Glass-Steagall, the reform that followed the Wall Street crash of 1929. Glass-Steagall was thirteen pages long and effectively protected our banking system for more than half a century--until the free market reformers under the leadership of Senator Phil Gramm had it repealed in the 1990's. (By the way, shortly after getting Glass-Steagall repealed, Grammy resigned his Senate seat and became vice-chairman of the largest Swiss bank at a multi-million dollar per year salary, a position he still holds today.)

Worse, every other page of Dodd-Frank demands that regulators fill in further detail. Some of these clarifications are hundreds of pages long. Just one bit, the “Volcker rule”, which aims to curb risky proprietary trading by banks, includes 383 questions that break down into 1,420 subquestions.

Even more ridiculous is the fact that the same Senate that passed Dodd-Frank has blocked the confirmation of virtually all the presidential appointees who would actually write all the necessary regulations. So while our elected representatives pat themselves on the back for "protecting" the U.S. financial system, in fact little has changed.

You may have read this week that both Barclay's Bank and DeutscheBank have legally reorganized their U.S. subsidiaries so that they avoid any regulation by U.S. regulators at all! These are both among the largest banks operating in the U.S. At the same time, the regulations that have taken effect are so expensive and strangling to the small community banks that many have already gone out of business and many more say they will have no choice but to follow. These are the banks that small businesses rely on for financing.

Hardly anyone has actually read Dodd-Frank, besides the Chinese government and the lawyers for the big banks in New York. But they read it mostly to confurm that the language they actually wrote got included by the lobbyists who provided it to the Congressmen who sponsored the bill.

Those who have to struggle to make sense of Dodd-Frank have an awful time because so much detail has yet to be filled in: of the 400 rules it mandates, only 93 have been finalized. So financial firms in America must prepare to comply with a law that is partly unintelligible, partly unknowable and clearly drafted to benefit the same banks it was intended to regulate.

And the whole thing was named for the two legislators arguably most responsible for the financial meltdown of 2007 that we still suffer from, Barney Frank and Chris Dodd.

Both the problems and his "solution" we're created over many years under the administration of both political parties. And how similar was the creation of "ObamaCare" to this story. It doesn't take much study to identify the similarities.

Oh, what a government we have. If here was ever an argument that we ought to throw them all out and start over, the legislation passed in recent decades sure seems to justify that.