There have been a number of press reports in recent days about attempts by the new Republican majority to repeal all or part of Dodd-Frank. Depending upon whom you choose to believe (assuming you choose to believe anyone in the current political environment), the Republicans want to eviscerate it, and the Democrats refuse to change one word, or possibly even a punctuation mark.
The real problem with Dodd-Frank is that it’s a mixed bag – a mess, of course, but a mixed bag nonetheless. My take on it is that there are some provisions that are reasonable and make sense; others go way too far; and still others don’t go far enough. For example, the infamous (and, IMHO, ridiculous) provision requiring public companies to disclose the ratio of the CEO’s pay to that of the mean of all employees’ compensation. On the other side, one wonders if the statute really did anything to regulate the financial services industry or if it did nothing more than exponentially increase the costs of compliance while leaving open the possibility that recent history (i.e., an economic collapse) could happen all over again for the same reasons.
What this suggests is that to make Dodd-Frank a good statute – assuming that’s possible – would require delicate surgery that would take time, careful thought and bipartisanship. It may go without saying, but I’ll say it anyway – that isn’t going to happen in the current environment. Grandstanding and blustery populist oratory seem to be the order of the day, and careful drafting isn’t even on the agenda. (Of course, that was the case when the statute was being drafted – one of the scariest things I ever saw on a monitor was a live webcast of Barney Frank’s subcommittee hearing, when multi-page riders were waltzed in to the hearing room and voted upon before anyone could read them – much less debate them.)
I’m not sure where that leaves us, but wherever that is, it’s not a good place to be.
There it is. I’d like to know what you think.
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