Republicans Accept No Blame For Bank Failures After They Voted To Deregulate Banks
“Where were the regulators?” Sen John Kennedy (R-La.) said on the Senate floor. “This whole debacle could have been avoided if the regulators had just done their job and stepped in and said, ‘Silicon Valley Bank, what you’re doing is dumb, and you can’t do it anymore.’”
Kennedy omitted a key detail from his remarks. He and the other members of the Senate Banking Committee — including several of the panel’s Democrats — wrote a bill in 2018 that told regulators they could relax their scrutiny of institutions like Silicon Valley Bank. (BuzzFeed, HuffPost’s parent company, banked with SVB.)
“The legislation that we passed did not eliminate liquidity stress testing,” Kennedy told HuffPost. “It did not eliminate the regulation at all of banks in that range.”
Kennedy is right — the law made enhanced prudential regulation optional instead of mandatory for mid-sized banks. But it wasn’t a mystery what regulators would do. Jerome Powell and Randy Quarles, the chairman and former top bank regulator at the Federal Reserve, told lawmakers during hearings on the legislation in 2018 that it would be a good idea to cut regional banks some slack.“They had the tools available,” Sen Mike Rounds (R-S.D.) told HuffPost. “The question is, why didn’t they use the tools?”
“It was an option,” Sen Thom Tillis (R-N.C.) said. “And if they chose not to do it, that’s gonna be a really good question based on the activities of Silicon Valley.”
Sen. Kevin Cramer (R-N.D.) said it’s not clear whether Silicon Valley Bank would have failed to meet the higher standards under Dodd-Frank. Meanwhile, Sen. Mark Warner (D-Va.), the top Democrat behind the 2018 rollback, said Wednesday that regular bank oversight could have caught the problems.
Sen. Mike Crapo (R-Idaho), who chaired the Senate Banking Committee in 2018 and was the lead author of the Dodd-Frank rollback, said Wednesday the bill had nothing to do with banks going belly-up.
“The fact is, this is not a capital issue. This is a liquidity issue,” Crapo said. “It’s an entirely different set of issues.”
Crackpottery pulse check:
An example of why truth doesn't stand a chance
in the face of demagogic dark free speech
Let's get this straight.1. Radical right and regular conservative Republicans hate government and regulations. They claim that free markets always do better than regulations. So Republicans and neoliberal Democrats, who also hate business regulations, voted in 2018 to deregulate "medium sized" banks with assets up to $250 billion.
2. Democrats who support reasonable regulations opposed the 2018 deregulation and warned that some deregulated banks would collapse, just like they did in 2008. New regulations were put in place in 2008 after bank failures. Before that, the neoliberal Bill Clinton signed onto deregulating banks, which led to the 2008-2009 financial and housing disasters, ruining thousands of lives.
3. In Nov. 2017, Trump, radical right and regular Republicans in congress put brass knuckles capitalist Jerome Powell in charge of the Federal Reserve. Once the 2018 deregulation law came online, Powell pushed bank deregulation as far as possible. Some experts argue he pushed deregulation farther than was legal. Powell and the entire GOP in congress hated and still hate bank regulations.
4. Elizabeth Warren says now in 2023: “If we hadn’t allowed the regulators the discretion to weaken bank regulations, then the regulations would not have been weakened. And if the regulations had not been weakened, there would have been tough stress tests on these banks. And we would have caught the problems at SVB.”
5. See how weak inconvenient truth and inconvenient reasoning are? The Repubs and Dems who deregulated, claims the regulations were not needed. Now, they blame the regulators, not themselves, for not regulating, even though their top regulators opposed regulating. This is completely nuts.
6. Despite being completely nuts, I bet that most, probably ~85%, of the radical right rank and file will fall for the deceit inherent in shifting blame onto regulators that the radical right elites put in charge of regulating banks. For a significant minority of Americans, e.g., nearly all radical right rank and file, neither truth nor sound reasoning stand a chance against ruthless dark free speech.
6. Despite being completely nuts, I bet that most, probably ~85%, of the radical right rank and file will fall for the deceit inherent in shifting blame onto regulators that the radical right elites put in charge of regulating banks. For a significant minority of Americans, e.g., nearly all radical right rank and file, neither truth nor sound reasoning stand a chance against ruthless dark free speech.
7. Or, are the anti-regulation Repubs and Dems correct to argue that this is all the fault of those tyrant deep state, Godless socialist bureaucrats who refused to regulate? Notice the blatant illogic inherent in that reasoning? Radical right elites vehemently tell us that tyrant, deep state, Godless socialist bureaucrats are the ones who push for freedom-killing tyranny socialist deep state regulations. Is this "reasoning" is completely nuts, or not? (It's completely nuts)
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Trump is laundering money for the Russkis - MAGA!! for president 2024: Forbes writes:
A federal criminal investigation into former President Donald Trump’s media company Trump Media has expanded to include potential money laundering violations linked to an $8 million loan with Russian ties, the Guardian reported Wednesday, potentially further threatening the ex-president’s media company and its planned merger with special purpose acquisition company Digital World Acquisition Corp (DWAC).
Fortunately for us MAGA!!land residents, the ex-pres will probably not face any legal jeopardy. The law is not intended to apply to rich and/or powerful people like him.
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Why the radical right targets corporate DEI and ESG: The NYT writes in a fact check and analysis article:
A growing chorus of [radical right] conservative pundits and politicians have said the failure of Silicon Valley Bank was the result of the bank’s “woke” policies, blaming the California lender’s commitments to workplace diversity and environmentally and socially conscious investments.
These claims are without merit. The bank’s collapse was due to financial missteps and a bank run.
Moreover, the firm’s policy on diversity, equity and inclusion — also known as D.E.I. — is similar to ones that have been broadly adopted in the banking sector. So is its approach to taking environmental and social considerations into account when investing — referred to as E.S.G. — although that has become a target of [radical right] conservatives.
In fact, Silicon Valley Bank is considered about average in the industry when it comes to these issues.
WHAT WAS SAID
“They were one of the most woke banks in their quest for the E.S.G.-type policy in investing.”
— Representative James R. Comer, Republican of Kentucky, in an appearance on Fox News on SundayFACT CHECKThis lacks evidence. First, experts have broadly agreed that the bank’s demise had little to do with “wokeness.” As The New York Times and others have explained, the collapse was due to a bank run precipitated by a decline in start-up funding, rising interest rates and the firm’s sale of government bonds at a huge loss to raise capital.
The bank’s loans to environmental and community projects “were not an important factor behind the collapse of SVB,” said Itay Goldstein, a finance professor at the University of Pennsylvania’s Wharton School. “There is no immediate indication that these loans precipitated the run by investors.”
Silicon Valley Bank also was not an outlier in its diversity goals or its E.S.G. investments.What the animosity to DEI and ESG amounts to is a major front in the bigoted and racist Christian nationalist (CN) culture war. Core CN dogma is open bigotry or racism toward out-groups that God hates. What groups does God hate and demand to be subjugated and oppressed by wealthy, White heterosexual men? Mainly:
- Women
- The LGBQT community
- Non-White people
- Atheists and agnostics
- Non-Christians and wrong-flavored Christians, e.g., pro-abortion and pro-church-state separation Christians and secularists generally
- Non-White immigrants, legal or not
- People who reject history rewritten into false narratives, e.g., lies about America being founded as a Christian nation or lies about Trump the Fornicator being chosen by God to lead America's moral re-enlightenment
Good 'ole CN. It's one heck of a dogma. Nasty to its morally rotted core.
Early days Christian nationalists
Christian nationalists at the 1/6 coup attempt
God chose the Fornicator to lead us to the
golden land of God's infallible self-righteousness
and deep hypocrisy
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