If you haven’t read it already, Jeb Hensarling has an op-ed in the Wall Street Journal lamenting the two year anniversary since the Dodd-Frank “reforms” were signed into law. Not only does the piece properly identify what caused the housing bubble and the 2008 financial crisis but it also states components of the law that institutionalize the “too big to fail” mentality and how Obama’s favorite pet, the Consumer Financial Protection Bureau, now has the authority to ration credit. The piece is as parsimonious as it is concise, making it great intellectual ammunition for the defense of free markets and damning government intervention in banking. Here’s a sample:
Perhaps most harmful, Dodd-Frank has codified into law a taxpayer-funded safety net for institutions deemed too big to fail—the Orderly Liquidation Authority, which the Congressional Budget Office predicts will cost taxpayers tens of billions of dollars. In downgrading the credit ratings of the nation’s largest banks last month, Moody’s explicitly stated that its ratings still reflect an assumption “about the very high likelihood of support from the U.S. government for bondholders or other creditors in the event that such support is required to prevent default.” So much for ending taxpayer-funded bailouts. And when we lose our ability to fail, we will soon lose our ability to succeed.
Click here to read the whole thing!