While most eyes are on the massive federalized government health care bill now making its way through the Senate, Congress is secretly working on other legislation to broaden and expand government even more. We cannot afford this continued spending ... America's back is breaking under the burden of debt.
Maximus at The Contemporary Conservative summed it up very well: Will Senator Mark Warner vote to create a new Frankenstein Federal Agency designed to strangle business recovery?
Sen. Chris Dodd (D-CT) introduced a wide-ranging piece of legislation last week that combines some of the worse anti-business provisions of securities "reform" legislation that was floating around.
Known as “Restoring American Financial Stability Act of 2009," the bill would create the Consumer Financial Protection Agency and promote what is referred to as "scheme liability."
There are business impacts that are direct to certain kinds of businesses, those that are indirect (such as to realtors, small banks, and auto dealers who will be harmed further if people can't get home loans or car loans) and those that hit all of us as end consumers either through reduced or eliminated access to certain kinds of loans or through higher prices for products and services (as the increased cost of doing business is passed along).
This thing is massive ... and creates another bureaucratic agency with more layers in government resulting in more taxpayer costs at a time when the federal debt has TRIPLED in the past six months.
One sentence in this massive Senate financial regulatory legislation would leave small businesses, banks, and accountants as well as virtually any other business subject to a flood of new securities class action lawsuits. Class action lawyers, who support the bill, would be allowed to sue virtually anyone who did business with a public company alleged to have engaged in fraud even if they didn't know anything about the alleged fraud.
This guilt-by-association provision would hurt innocent companies by forcing them into extortionate settlements. Because securities class action lawsuits tend to seek massive damage awards, many bystander businesses -- even those bearing no culpability whatsoever -- would feel compelled to settle the lawsuits rather than go to trial and risk losing a "bet-the-company" case.
The Securities and Exchange Commission and the Department of Justice are already in place and authorized to prosecute those who aid and abet violations of securities laws so why is another newly-created agency necessary?
There have been news reports in many states of securities class action lawyers engaging in pay-to-play with public pension fund officials, contributing large amounts to their campaigns in return for contracts to represent the pension fund in lawsuits in which the lawyers are likely to make tens of millions of dollars in legal fees.
Aside from specific concerns that certain businesses have because of the direct impact coming from this legislation, it is a given that consumers will be adversely impacted by anything that drives up the cost of doing business.
So whether it is because of increased legal costs in defending against lawsuits, increased costs of complying with regulations or artificial determinations about the cost of products, these new increased costs of doing will will be passed on to the consumer. And that is everyone.
The Heritage Foundation agrees there is absolutely no rationale for creating such an agency:
During last year's presidential campaign, Barack Obama noted that "you can put lipstick on a pig, but it's still a pig."Sen. Mark Warner is a member of the committee and, as a businessman, should be pulling back in horror at the thought of this overreaching government bureaucracy. Calls and letters are urgently needed to ask Sen. Warner to vote NO on creating another bureaucratic agency. He can be contacted by letter, FAX, or phone call:
This phrase neatly sums up the ongoing ... Financial Services Committee markup of .... the Consumer Financial Protection Agency (CFPA) Act of 2009. Despite honest attempts to improve the bill, the overall concept is still badly flawed, and any result that comes close to the original concept will be a major mistake. There is simply no rationale for creating such an agency that a coordinating council of state and federal financial regulators cannot accomplish easier and at a lower cost.
The Honorable Sen. Mark WarnerCongress should rely on legislation already in place, such as the SEC and Department of Justice, to enforce the laws on the books rather than create new bureaucracy, more debt, and more opportunity for ACORN to have access in this Obama administration.
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