Guest opinion: My kids are smarter than a congressman
Did anyone read the July 28 Scott Tipton guest opinion? My eighth-grade kids knew the correct answer on this issue because of studying American history. They are too young to have a political opinion, but they do recognize stupidity.
In his guest opinion, Tipton says: “Dodd-Frank was supposed to lift the economy out of a recession, promote financial stability and end the ‘too big to fail’ phenomenon. In actuality, the legislation has created more market uncertainty, escalated costs for consumers and accelerated the failure rate of small Main Street banks.”
Your facts are incorrect, sir. The Dodd-Frank Bill was designed to replace the gutted Glass-Steagall Act of 1933. It was not designed to lift the economy, but to protect the economy from repeating the bad banking decisions of 1929.
I’m in awe that a sitting congressman can be so off on his facts. Didn’t he ever study the 1929 Depression? Did he not learn about the 1933 Glass-Steagall Act? It was designed to protect the consumers from our banks taking risky loan positions. In other words, Congressman, it was to block the banks from repeating the 1929 disaster.
The Glass-Steagall Act did a superb job until Bill Clinton and three Republican members of Congress, Sen. Phil Gramm, Rep. Jim Leach and Rep. Thomas J. Bliley Jr., stupidly gutted the Glass-Steagall Act that had a proven track record of 66 years with not one bank meltdown.
We must ask ourselves why would anyone would gut such a wonderful successful protective regulation/law. In Washington/Congress, they say if you want to know a man’s true motive for his voting, follow the money. Did these four men get a lot of financial support from the banking industry? No one can be that naïve to think that if we eliminate all regulations, humans beings and corporate America will self-regulate, always making the right decision, always putting the public’s interest before profit. Ha! Are you kidding me?
Rep. Tipton says: “The regulatory burden under the Dodd-Frank Act has imposed 61 million paperwork hours — at $24 billion in compliance costs, according to one calculation — with the hardest hit being small financial firms. During a visit to First Colorado National Bank, a locally owned bank with a $50 million portfolio in Delta, I heard firsthand how much of a toll this law has taken on banks that are the lifeblood of small communities’ economies. Instead of hiring tellers and loan officers, these banks are hiring compliance staff in order to keep up with new regulations. It is disappointing to hear that small bankers no longer feel like they run their bank, but that the federal government runs their bank for them.”
Again, Congressman, the regulations are there to protect society from greedy banks that put profit in front of what is ethically, legally and morally appropriate banking decisions that will affect all of society. If the current Dodd-Frank law is so bad, there’s a simple fix: Bring back the original Glass-Steagall Act of 1933.
Sadly most Republicans have a knee-jerk reaction to regulations. They seem to hate all regulations. They say we can trust corporate America to do the right thing, to put the safety of our citizens first over profit. If that’s the case, then why did we have so many examples of terrible choices of corporate America cutting corners, putting profit first that end up hurting us citizens?
Example: Oil companies in the Gulf of Mexico cutting corners on the concrete setup of their oil rig — the oil spill lasted how many weeks? How much of our shrimp industry has been ruined? How many of our Gulf Coast businesses were destroyed? How many millions of dollars has the public spent to clean up corporate America’s mistakes?
In 2008, the banking industry repeated 1929 mistakes of greed and bad decision-making all over again, and our Congress asks us citizens to bail out the banks.
Does anyone still believe the tobacco companies’ Marlborough Man ads? Does anyone think that the tobacco companies are putting the safety of our citizens in front of their profits? If you still believe their lies, then you must be from the 1950s. Who could argue that tobacco doesn’t cause cancer?
Rep. Tipton says: “With five years under our belt to evaluate the impact of the Dodd-Frank Act, it is obvious that the legislation has not fulfilled its intended purpose. Until the law can be repealed and replaced with sensible reforms that focus on the actual causes of our most recent financial crisis, it is time to revisit this legislation with common sense changes to ensure community banks operate under a manageable compliance regime, small businesses have the capital they need to grow, and consumers have a choice when it comes to their bank and banking products.”
With all due respect, Mr. Tipton, you don’t have to reinvent the wheel. Just remember what you learned in eighth grade. If you can’t remember, just ask your son or daughter. Replace the Dodd-Frank bill with the original 1933 Glass-Steagall Act that was 100 percent successful at regulating the banks. How hard would that be?
I’m not sure, Congressman, if you’re forgetful or you never studied American history in school or you’re just incredibly naïve to trust corporations to “self-regulate”; that humans always do the right thing. As a human being, we are by definition flawed, we make mistakes, we’re greedy, we lie, cheat, steal. That’s why we have prisons for bad people.
President Reagan had a great quote that would apply to this entire guest opinion: Trust but verify. That’s why we still need regulations: Because as human beings, we are flawed and imperfect. It’s by the love and grace of God that we have any hope.
I hope you’re not the example that President Reagan used to offer: The best minds are not in government. If any were, business would hire them away.
KC Johnson lives in Snowmass.
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