Friday, July 16, 2010

2,319 Page Dodd-Frank Bill aka The “Lawyers’ and Consultants’ Full Employment Act of 2010"

Now that Congress has passed the “Dodd-Frank Wall Street Reform and Consumer Protection Act,” it might be a good time to compare the 2,319-page financial reform bill (245 pages longer than the healthcare bill) to the previous bills listed below (and see graph above) that are considered among the most consequential legislative acts for banking and finance.

1. Federal Reserve Act (1913) - 31 pages.

2. Glass-Steagall Act (1933) – 37 pages.

3. Interstate Banking Efficiency Act (1994) – 61 pages.

4. Gramm-Leach-Bliley Act (1999) – 145 pages.

5. Sarbanes-Oxley Act (2002) – 66 pages.

Read more here at The Enterprise Blog.

42 Comments:

At 7/16/2010 7:56 AM, Blogger Bruce Hall said...

Bill stuffing: http://www.techdirt.com/articles/20100625/1329029963.shtml

The Democrats are using these "legislative opportunities" to stuff all manner of government-building agencies and regulations into them.

Consider each 10 pages a form of taxation.

 
At 7/16/2010 8:12 AM, Blogger juandos said...

Mr. Hall: "Consider each 10 pages a form of taxation"...

I do believe that you've hit the nail squarely on the head...

The WSJ I think does a pretty good job describing what's in store with the Dodd-Frank Extortion of the Productive act...

Meanwhile the folks over at Investors Business Daily in an editoria note that there is a problem, a major problem of ethics from those that generated this monstrosity: The Price Of A Vote

 
At 7/16/2010 9:11 AM, Blogger Dr William J McKibbin said...

Actually, the Dodd-Frank Act contains 848 pages in final form, which is still considerably more than past legislation. More at:

http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=111_cong_bills&docid=f:h4173enr.txt.pdf

 
At 7/16/2010 9:29 AM, Anonymous Hieronymus said...

I am sure this will aid in O's goal of "transparency."

And I am sure that consumers, at last, will be protected -- a giant prophylactic against sepsis from the REAMS involved in this bill (I refer to the its size, of course--giant).

 
At 7/16/2010 10:36 AM, Blogger Jason said...

Whether 848 or 2319 pages, the size clearly demonstrates how dysfunctional our government has become. Don't forget, the Democrats control both houses and the white house. A bill of that size has to contain dozens of special interest exceptions, special cases, pet project and riders...

When democrats can't agree with democrats over something that a plurality of people think is necessary, you wonder when the whole mess will implode.

For the record, there are some things I like about this bill, somethings I hate and somethings...I just cannot predict the consequences. I hope it turns out ok.

Professor Perry, do you have news clippings or historical data to say how Glass-Steagall was received?

 
At 7/16/2010 10:45 AM, Blogger bob wright said...

Personally, I'm sleeping much better now that the democrats have put an end to future financial crises.

Now that they have slain the crisis dragon, they should be able to wrap up world hunger by Christmas.

 
At 7/16/2010 11:03 AM, Anonymous Anonymous said...

As it was with Sarbanes-Oxley, we’ll be told that our last economic crisis was someone else’s fault (but never Congress’) and all we really need is a hefty dose of legislative medicine. And “hefty” doesn’t even begin to describe this dose of legislation. In 2,500 pages of dense prose, we’re about to receive legislation that could better be entitled “The Lawyers’ and Lobbyists’ Full Employment Act.”

- Harvey Pitt, a former chairman of the SEC

 
At 7/16/2010 11:11 AM, Blogger Benjamin said...

If the length of the Dodd-Frank bill, at 848 pages, is proof of impossibly dense and stupid management, then what to make of the 463-page Department of Defense appropriations bill?

That's just the DoD appropriation, not the DoD authorization, which is a whole 'nother bill.

And it is an annual bill, not milestone legislation. 463 pages--mostly gobbledygook, btw.

Here is some language from the DoD bill:

"Language is included that provides for the Department of Defense to comply with the Buy American Act (title III of the Act entitled ‘‘An Act making appropriations for the Treasury and Post Office Departments for the fiscal year ending June 30, 1934, and for other purposes’’).
Language is included that provides conditions under which contracts for studies, analyses or consulting services may be entered into without competition on the basis of an unsolicited proposal."

So I guess the bill is allows the DoD to Buy American, and without competition on the basis of an unsolicited proposal. Oh, do you think some lard is headed out to someone's Congressional district, for a campaign supporter? Just maybe?

The mere length of a bill tells us nothing, although the smelly contents of the DoD bill tells us much.

All classical economists (such as Milton Friedman) concur that militaries are parasites. All observes concur the longer a federal agency exists, the more it is characterized by ossified lard.

In the US, we top that by having a coprolitic and parasitic military complex--the largest eater of federal income tax dollars, the biggest impediment to economic growth and prosperity in the US government.

 
At 7/16/2010 11:13 AM, Blogger juandos said...

Let's depend of pseudo benny to make a thoroughly false and silly comments: "All classical economists (such as Milton Friedman) concur that militaries are parasites"...

Got anymore of these knee slappers?

 
At 7/16/2010 11:24 AM, Anonymous Norman said...

Dodd-Frank Bill, UGH. Chris Dodd got a cheap mortgage from Countrywide and Frank was and still is hot for giving away mortgages to those who can't pay for them. The 'Bill' will probably just continue to screw things up.

 
At 7/16/2010 11:36 AM, Anonymous Rand said...

Since the two named sponsors of the bill are both crooks, does that mean that the entire bill is crooked?

 
At 7/16/2010 12:32 PM, Anonymous gettingrational said...

Financial Reform in few words:

1. The Volker Rule of separating traders and banks.

2. All derivative trades go through a clearing house.

3. Ratings are paid for the buyers and not sellers.

4. Any house mortgage must start with at least a 20% down payment.


Any violation of the above will result in a felony. Traders will not be bailed out and banks will have limits on leveraging.

 
At 7/16/2010 12:59 PM, Blogger Paul said...

Benji always feels the need to change the subject away from the economic wrecking ball his boyfriend and beloved Democrats are swinging at the economy. Who exactly is saying there isn't alot of waste at DoD?

"All classical economists (such as Milton Friedman) concur that militaries are parasites."

You know somebody is talking out their ass when they make a sweeping statement like "..all X agree..." No they don't. Security and prosperity are mutually reinforcing. A good example is the amazing come back of Colombia under Uribe. His strong pimp hand against the FARC is probably the key reason the stock market has soared fourteenfold since 2001.

 
At 7/16/2010 1:07 PM, Blogger randian said...

The bill will hit private equity firms hard. They changed the accredited investor standard to exclude, rather than include, the value of personal residences in computation of net worth, and require the SEC to adjust the net worth minimum "as the Commission may deem appropriate". When somebody with a 2 million dollar free and clear house can't invest $50k in a business because they no longer qualify as accredited, a huge portion of potential investors will now be locked out. As somebody looking to raise money, this is a punch in the gut. This is obviously a sop to Wall Street. If these people can't invest in private equity anymore, where are they going to to? Wall Street.

 
At 7/16/2010 1:54 PM, Blogger juandos said...

"Benji always feels the need to change the subject..."...

You know Paul everytime pseudo benny goes off on a weird tangent like he does I can't help but remember the Post Turtle joke...

 
At 7/16/2010 1:54 PM, Anonymous Rand said...

The Declaration of Independence - 6 pages (including signatures)

The Constitution of the United States (including amendments) - 17 pages

 
At 7/16/2010 2:09 PM, Anonymous Benny The Man said...

The Defense Department authorization bill is 742 pages, and the Appropriations bill is 463 pages.

The total of these two bills easily exceeds the 848-page Dodd-Frank bill.

So, if page counts measure stupidity, then the DoD bills are more stupid than the D-F bill.

Paul-

Everybody knows militaries are parasitic--even President Eisenhower said so (the last great R-Party president, btw).

In the next 10 years, the federal bureaucracy called the DoD will such $10 trillion dollars out of your wallet and from the productive, tax-paying private sector--far more damaging than some financial bill.

Dr. Perry is fighting phantoms, while real drags on our economy--the DoD--are mysteriously unchallenged. Politics trumps true economic analysis? .

National Defense outlays, 1998 – 2011

NominalReal (FY 2005) % of GDP
1998 $268.1 $346.1 3.1
1999 $274.7 $347.6 3.0
2000 $294.3 $361.3 3.0
2001 $304.0 $363.1 3.0
2002 $348.4 $401.7 3.3
2003 $404.7 $444.6 3.7
2004 $455.0 $480.3 3.9
2005 $495.3 $495.3 4.0
2006 $521.8 $499.3 3.9
2007 $551.0 $509.2 4.0
2008 $616.0 $548.6 4.3
2009 $661.0 $580.2 4.6
2010 (est.) $719.1 $626.0 4.9
2011 (est.) $749.7 $644.0 4.9

Real military outlays (including lard and patronage) up more than 80 percent since 1998.

And we are "fighting" no one except a few punk terrorists!

The "War on Terror" should be called the "War On Your Pocketbook and the Taxpayer."

Every time our economy generates $1.00 in wealth, the DoD sucks in a nickel--coast-to-coast, everywhere all the time.

 
At 7/16/2010 2:24 PM, Blogger juandos said...

"Everybody knows militaries are parasitic--even President Eisenhower said so (the last great R-Party president, btw)"...

post turtle benny strikes again...

I'm betting you feel NO shame putting up such a silly and factless comment, right?

 
At 7/16/2010 2:31 PM, Blogger Paul said...

"Everybody knows militaries are parasitic--even President Eisenhower said so (the last great R-Party president, btw)."

Really? General Eisenhower called his fellow soldiers parasites? You do have a quote to back that up, don't you? "Military industrial comples" is not sufficient.
And if there is a hive of parasites anywhere, it's housed in the Democrat party.

You really don't want to talk about the Dodd-Frank bill, do you? I don't blame you.

 
At 7/16/2010 3:18 PM, Anonymous Benny The Man said...

The Dodd-Frank bill probably has some merits--I don't think it will change much, one way or the other.

Wall Street is Wall Street and always will be.

However, something has to be tried. Our financial system collapsed on President Bush's watch. He had been President for nearly eight years, and our system collapsed.

The economy and financial system was a train wreck into a sewage treatment plant--that is where Bush's leadership left us, and that us where Obama took over.

We seem to be crawling out of it, but the Fed's stupid lack of aggressive tactics is holding us back.

Meanwhile, China has been growing at double-digits, following an expansive monetary policy and some deficit spending. There have a small military.

When it comes to military spending, you should think about if the government built $600 billion a year of high-tech advanced bridges to nowhere in the middle of the desert, then tore them down, and built them again the next year. The effect on our economy would be about the same as our current military budget.

If you doubt that, you know nothing abut economics.

 
At 7/16/2010 3:42 PM, Blogger PeakTrader said...

The U.S. dollar as the world's reserve currency and the ability of the U.S. economy to expand with huge negative net exports (which no other country or group of countries can challenge) allow the U.S. to expand its global economic and military empire.

 
At 7/16/2010 3:46 PM, Blogger Paul said...

"However, something has to be tried."

Something, anything! 2300 pages of Congressional mischief counts as something. Let's try it, by golly!

Our financial system collapsed on President Bush's watch. He had been President for nearly eight years, and our system collapsed."

And just like that it's all Bush's fault. Do you have a unified theory to explain this, or are you that much of a simpleton?

"We seem to be crawling out of it,

Crawling out of it? Your boyfriend is burying us deeper for the long term.

"..but the Fed's stupid lack of aggressive tactics is holding us back."

Oh, the Fed hasn't engaged in enough money alchemy. Nothing to do with your boyfriend's war on capitalism.

"When it comes to military spending, you should think about if the government built $600 billion a year of high-tech advanced bridges to nowhere in the middle of the desert, then tore them down, and built them again the next year. The effect on our economy would be about the same as our current military budget."

Sounds exactly like the Keynesian economics your boyfriend and the Pelosi Democrats embrace. You should be championing it.

 
At 7/16/2010 4:09 PM, Blogger PeakTrader said...

It seems, the U.S. can consume more than produce at least 3% of GDP indefinitely (through inflation, interest rates, and currency exchange rates). So, foreigners are paying most of the U.S. military budgets.

 
At 7/16/2010 4:18 PM, Anonymous Benny The Man said...

Paul-

You are correct sir. We finally agree on something.

The bloated, ossified military budget is Keynesianism in action. Debt-fueled stimulus.

The problem is, we have been funding this drag-on-long-term growth for decades, and at higher amounts than ever before (excepting WWII). Toss in systematic patronage, and you being to get the true picture.

Any intellectually honest discussion about how the federal government retards growth and crimps the private sector has to begin with DoD and USDA

But the right-wing turns into a bunch of little girls whenever they see a uniform.

 
At 7/16/2010 4:31 PM, Blogger juandos said...

"Any intellectually honest discussion about how the federal government retards growth and crimps the private sector has to begin with DoD and USDA"...

By golly pseudo benny you would give Nancy Pelosi real competition with the bizzare quotes and all...

 
At 7/16/2010 4:50 PM, Blogger misterjosh said...

Benny, your hypocrisy has me confused. You argue that Professor Perry is too focused on too few things, and yet your response is to laser in on inflation, ag subsidies, & the military.

I think ag subsidies & military spending should be cut, but at least they're kinda useful. We get cheap food & big guns. The shit Dodd & Frank are pulling here is going to accomplish absolutely nothing.

 
At 7/16/2010 5:15 PM, Blogger Paul said...

"The bloated, ossified military budget is Keynesianism in action. Debt-fueled stimulus. "

And yet you'll keep on voting for your beloved Democrats who use the theory as an excuse to grow government. DoD needs some trimming, but at least we get lots of dead terrorists and liberated children out of it. That's more than you can say about your boyfriend's stimulus and other expensive gimmicks.

"Any intellectually honest discussion about how the federal government retards growth and crimps the private sector has to begin with DoD and USDA."

I don't think very mamy here have a problem with zeroing out USDA & trimming DoD, but don't look to the left side of the aisle for the argument against big government. Your boyfriend pledged to make "government cool again."

And you enthusiastically pulled the lever for him anyway.

 
At 7/16/2010 6:45 PM, Anonymous Benny The Man said...

Mister Josh-

Well, I don't know if I am being a hypocrite.

It's true, right now the battle should be taking place over Fed policy. I advocate something called quantitative easing, and, in general, aggressive growth polices at the Fed. I do not advocate more deficit spending--one reason I no longer support the R-Party.

Mr. Inflation is wearing cement shoes, and sitting in the back of a car owned by Jimmy Vitali. Near an abandoned pier. On a dark, rainy night.

Unit labor costs are going down, the PPI is sinking at 6 percent annual rate, and commercial/industrial rents are really soft.

We are staring at Japan-itis.

I am not sure, economically, the D-F bill matters much. Knee-jerk reaction that it must be bad--are there elements of the bill you do not like? Such as?

Still, if we are going to talk about federal activities that consume hundreds of billions of resources every year, relentlessly, without fail, than we have to focus on DoD and USDA, and other rural welfare and infrastructure programs.

Pat Buchanan, the right-wing commentator and former Nixon speechwriter, calls our current military posture a "relic" and fading "empire." He thinks we should wipe out most overseas bases (we have nearly 1,000 installations globally). Paul Cohen (deceased US Navy brass) was calling to eliminate surface ships as long as as the 1970s.

It is true conservatives who are stunned at our nation baby-sitting in Iraqistan, and how we prop up opium-fueled narco-states, or Islamic states where religious freedom is not allowed. Imagine US Marines guarding opium fields of Islamic theocrats growers loyal to Karzi!

This is American foreign policy--or stupidity?

 
At 7/16/2010 7:29 PM, Blogger Paul said...

" I do not advocate more deficit spending--one reason I no longer support the R-Party."

Do you follow current events at all, Benji?

 
At 7/16/2010 8:22 PM, Anonymous Benny The Man said...

Paul-

Been following the R-Party for 50 years-no R-party President has even proposed a balanced budget since Eisenhower.

Since then, the Republican Party has become a ring of grifters, a confederacy of feckless poltroons, and flag-wavers.

I understand your contempt of the Democrats. What I don't understand is why anyone has the smallest shred of faith in the Republican Party.

 
At 7/16/2010 9:29 PM, Anonymous Lyle said...

The way I look at it the Republicans say one thing and do another (look at them 2001 2007 when they said they would spend less but did the opposite. At least with the democrats they are consistent. I doubt seriously that if the republicans get back in they would do any different than the Delay crowd did. There whole goal will be to be re-elected so you spend to get reelected and put in another K Street project. Recall that the contract with america called for Term limits, but did it ever come up for a vote and pass the House at least, no, because they like being in congress to much.

 
At 7/17/2010 2:38 AM, Blogger PeakTrader said...

The Obama "recovery" has placed us on a slow track U-shaped recovery, where the U.S. is prevented from reaching full employment until 2016 or 2017.

Given the U.S. has never had a 10-year expansion without a recession, there may be another recession before we reach full employment.

Obama stated we can't afford another bubble (he uses "can't afford" many times, most recently on under-education). We may end up with the opposite of a bubble.

Obama's economic policies are almost the opposite of Reagan's policies, which generated a real V-shaped recovery and a long-lasting period of prosperity.

 
At 7/17/2010 5:40 AM, Blogger Free2Choose said...

Benny said, ""However, something has to be tried."

Classic politician's syllogism:
Oh crap! Things are pretty bad. We have to do something

Well,"this" is something.

Therefore, we must do "this"

 
At 7/17/2010 6:43 AM, Blogger Paul said...

"Been following the R-Party for 50 years-no R-party President has even proposed a balanced budget since Eisenhower. "

You just repeat the same talking point over and over no matter how often you're proved incorrect. George W Bush's first budget proposed a surplus. Didn't happen, but it was proposed.
Further, the unified GOP's last budget in '06 left behind a $163 billion deficit. How are the Democrats doing since they took over, Benji? What are their future projections?

"I understand your contempt of the Democrats. What I don't understand is why anyone has the smallest shred of faith in the Republican Party."

It's not faith, it's more like having to choose between eating at McDonald's or out of a trash can in some back alley. The GOP has plenty of faults, but at least our side doesn't elect socialist community organizers, or have Congressional leaders who say unemployment checks create jobs.

 
At 7/17/2010 9:58 AM, Anonymous Anonymous said...

A financial reform bill need to be done. The GOP had the opportunity to contribute but choose not to.

You can't obstruct a process then complain about the results.

 
At 7/17/2010 10:04 AM, Anonymous Anonymous said...

> George W Bush's first budget proposed a surplus. Didn't happen, but it was proposed.

How about a little honesty. How about the prescription drug benefit?
The 10-year estimate of that bill is $1.2 trillion. It was hugely irresponsible, and that's without even talking about the two wars.

The GOP is not, and has not been since before Reagan, serious about govt debt.

 
At 7/17/2010 10:43 AM, Blogger juandos said...

"A financial reform bill need to be done"...

According to which credible source?

"You can't obstruct a process then complain about the results"...

Sure you can especially when such a deeply flawed bill is just another fed power grab...

Doesn't anyone else see the irony of that the two sponsors, Rep. Barney Frank and Sen. Chris Dodd, are as much responsible for the financial crisis as any two people in America?...

 
At 7/17/2010 12:12 PM, Anonymous Anonymous said...

> According to which credible source?

Oh oh, Ayn Rand zombie alert. The worst financial crisis since the Great Depression, unemployment over 9%, trillions of dollars lost in citizens wealth, but hey, let's just keep everything the same.

The credible source you're looking for is common sense.

 
At 7/17/2010 12:35 PM, Anonymous Anonymous said...

Re: Dodd and Frank

You should really try to broaden your reading horizon a little. If a fact starved 2 page web blog article can convince you as to the causes of the financial crisis, you're in real trouble.

There's a distinction between subprime-backed securities
and individual subprime loans. Subprime backed securities are not loans. They’re securities.

The sub-prime loans underlying the sub-prime securities were not underwritten by either Fannie and Freddie. In fact, they're not allowed to.

The sub-prime loans that were the problem originated with private mortgage lenders. Corruption at the rating agencies led to these being granted AAA ratings, which opened up thousands of institutions to buy them, including Fannie and Freddie.

The problem here was not the govt or a couple of congressman, but a lack of regulation and over-sight.

 
At 7/17/2010 7:18 PM, Blogger Paul said...

"How about a little honesty. How about the prescription drug benefit?"

Yeah, that one sucked, no doubt. The Democrat alternative was far more expensive, and not paid for either.

 
At 7/17/2010 10:28 PM, Blogger juandos said...

"The worst financial crisis since the Great Depression, unemployment over 9%, trillions of dollars lost in citizens wealth..."

Then maybe people should've been smart enough not to vote for a commie...

Just a thought... I'll grant you though that I'm not sure that McCain would've have been a whole lot better...

"The credible source you're looking for is common sense"...

Where is that supposedly common sense? Planet Keynes?

"If a fact starved 2 page web blog article can convince you as to the causes of the financial crisis, you're in real trouble.."...

Well I can see you mediamatters types hate what you'd call 'fact starved blog posting' since it undercuts your tenuous grip on the situation...

"The sub-prime loans underlying the sub-prime securities were not underwritten by either Fannie and Freddie"...

Did this also happen on Planet Keynes? Who do you think the private banks had to compete with?

Would there have been subprime loans without federal interference in the housing market?

 
At 7/17/2010 10:34 PM, Blogger juandos said...

Origins of the Fannie Mae/Freddie Mac Crisis


The Diversity Recession

 

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