Thursday
Mar262009
Need To Close the Gaps In Resolution Regimes
Thursday, March 26, 2009 at 1:26PM
By Kayleigh Harvey - Talk Radio News Service
“From the outset I have argued that our financial system is not merely in need of ‘reform,’ but of ‘modernization,’” said Senator Christopher Dodd (D-Conn.), Chairman of the Senate Banking, Housing and Urban Affairs Committee.
At the hearing, which discussed “Enhancing Investor Protection and the Regulation of Securities Markets,” Senator Dodd asked the Chairman of the SEC Mary Schapiro, “Were you consulted by the Treasury and the Fed? What role do you think the SEC should play in this resolution mechanism, given the oversight and regulatory responsibilities?”
Senator Dodd also asked Ms. Schapiro to “comment on the reports of the regulatory changes that Secretary Geithner has mentioned this morning.”
Ms. Schapiro responded, “generally there was consultation.”
Ms Schapiro added, “We clearly have gaps in our resolution regime for large financial institutions....I fully support the concept of closing the gap in resolution regime so that we have a more coherent approach.”
Senator Chuck Schumer (D-N.Y.) said, “We all believe people should be rewarded for good performance, that’s not the problem, but what we’ve seen in many instances that has enraged Americans is a heads-eye wind tail you lose system. In which executives are rewarded for flashing the pan short term gains, or even worse, rewarded richly when the company does poorly and the shareholders have been hammered.”
“From the outset I have argued that our financial system is not merely in need of ‘reform,’ but of ‘modernization,’” said Senator Christopher Dodd (D-Conn.), Chairman of the Senate Banking, Housing and Urban Affairs Committee.
At the hearing, which discussed “Enhancing Investor Protection and the Regulation of Securities Markets,” Senator Dodd asked the Chairman of the SEC Mary Schapiro, “Were you consulted by the Treasury and the Fed? What role do you think the SEC should play in this resolution mechanism, given the oversight and regulatory responsibilities?”
Senator Dodd also asked Ms. Schapiro to “comment on the reports of the regulatory changes that Secretary Geithner has mentioned this morning.”
Ms. Schapiro responded, “generally there was consultation.”
Ms Schapiro added, “We clearly have gaps in our resolution regime for large financial institutions....I fully support the concept of closing the gap in resolution regime so that we have a more coherent approach.”
Senator Chuck Schumer (D-N.Y.) said, “We all believe people should be rewarded for good performance, that’s not the problem, but what we’ve seen in many instances that has enraged Americans is a heads-eye wind tail you lose system. In which executives are rewarded for flashing the pan short term gains, or even worse, rewarded richly when the company does poorly and the shareholders have been hammered.”
It’s out! Democrats present budget
This morning Congressional Democrats presented a budget they claim will make essential investments in the economic recovery and drastically reduce the deficit nearly in half by 2014.
Congressman John Spratt (D-NC) said the resolution will reduce the $1.8 trillion deficit to $586 billion by 2014.
“We’re going to take student loans and convert them into direct loans, saving $53 billion over a period of five years. We’re going to put money in the IRS, and HHS (Department of Health and Human Services) and other government agencies, and say, ‘We want to see stricter enforcement,’ because we believe program integrity initiatives like that can save as much as $50 billion.... Now that’s not a deficit that is satisfactory in and of itself but it is quite an accomplishment,” Spratt said.
Today Republicans are expected to issue their budget proposal, their second in two weeks.
“Apparently they are divided on this issue,” said House Majority Leader Steny Hoyer (D-MD). “We wanted multiple budgets as we normally do as well but we are not divided. We’re going to see a unity of purpose and unity of commitment on the Democratic side. I don’t mean unanimous but great unity.”
Spratt says the budget introduced by Rep. Paul Ryan (R-WI) and other representatives is “awfully hard to get down because it calls for some huge, substantial cuts.”
House Education and Labor Committee Chair Rep. George Miller (D-CA) said he is “excited” to see that this budget along with the economic stimulus package, for the first time, will provide more resources for early childhood education all the way up to college education.
“This budget with respect to education responds to what every business leader who has come to this Capitol, has demanded from this Congress, and that is to improve the American education system so that when we emerge out of this economic crisis we will be stronger, we will be better educated and we will be more competitive in the globalized economy that confronts us from now throughout our entire future,” Miller said.
The budget stresses the need for a clean energy economy. Congressman Ben Ray Lujan (D-NM) says the proposed budget will create energy independence and job creation.
“The Democratic budget builds on a significant funding and tax incentive for the Recovery Act by increasing our critical investment in renewable energy and energy efficiency by some 18% for 2010.... We need to do this to limit our dependence on foreign oil,” Lujan said.