Gaius Publius examines a disturbing development in House Ag committee Dems vote to deregulate derivatives:
This is a major under-the-radar story. The House Agriculture Committee, including its Democrats, voted just this week to gut the Dodd-Frank regulation of derivatives by approving a series seven bills. Of the seven, six are strongly opposed by public-interest regulation watchdogs. All seven bills now go to the House floor for a vote there.
This is a bad-Dems story, and also a derivatives story.
Read the details at Americablog.
Minnesota's Democrats on the committee--ranking member Collin Peterson and Tim Walz--aren't among the "bad-Dems." Given Peterson's work on financial reform in 2010 when he chaired the ag committee, the "No" vote isn't a surprise. (The ag committee's oversight of commodity markets gives it the ability to consider legislation related to the financial industry).
Gaius Publius notes Huffington Post's report on Peterson's reaction: Wall Street Deregulation Advances As Top Democrat Warns That Vote Could 'Haunt' Congress:
The most controversial bill to advance Wednesday is explicitly designed to expand taxpayer backing for derivatives. It was the only legislation that lawmakers were required to cast individual votes for or against; the others were all approved by unanimous voice votes. The bill to increase taxpayer support for bank derivatives dealing was approved by a vote of 31 to 14.
Prior to the vote, the top Democrat on the Agricultural Committee, Rep. Collin Peterson (D-Minn.), gave a speech warning that the legislation could repeat the deregulation debacles of the 1990s.
"Two of the worst votes I ever made in this place was the Commodity [Futures] Modernization Act of 2000 that exempted all of these swaps from any regulation or any margins," Peterson said. "I didn't know any better. The other vote I made that was really bad is eliminating Glass-Steagall. We should have never done that and I bought into that. You know, if we had Glass-Steagall back, this wouldn't be an issue here ... You're putting taxpayers on the hook. And if you wanna do that, fine. But I mean, you know, when I, when a lot of us were here, we hadn't paid enough attention and this thing blew up on us. At the time we did the Modernization Act, there were $80 billion in swaps, in derivatives. We gave 'em legal certainty, we eliminated the regulation requirements, and it went to $700 trillion and it blew up on us. So just be careful: You can vote any way you want, but this could come back and haunt you.
Here's Peterson speaking out about the bills:
Photo: Seventh District DFL Congressman Collin Peterson.
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