Thursday, January 25, 2018

Deregulation For Dummies

Too Big To Fail - Squawk
Too Big To Fail - Squawk
Deregulation Bad - Squawk
Deregulation Bad - Squawk.
Polly want a cracker....

Listen you morons.  Do you want to commit the perfect murder, without leaving any trace? Just parrot the "deregulation is bad" nonsense in my presence one more time and I will probably drop over dead of an embolism on the spot. There is no such thing as "Deregulation." Deregulation is a slogan created to portray political enemies as allowing large companies to pour nuclear and toxic waste into rivers and kiddie pools, and greedy corporate fat cats to commit fraud on gargantuan scales, and throw the "little guys" from the parapets of their ivory towers over lunch just for fun.<!--more-->

Lesson #1 from Ben's book of deregulation for idiots is: Huge companies love regulations. The more the better. Regulations always create an expense. Lots and lots of expense. Ginormous Multinational Corporations can absorb these costs easily without so much as a blink, while passing them to their customer's virtually imperceptibly. A regulation that costs every company twenty million dollars can be spread over a huge company's products and only raise the cost of each of their products by a few tenths of a cent. Small companies that must also comply with the same regulation and incur the same expense will necessarily raise their competing products to an exponentially higher degree, giving them a glaring, and potentially insurmountable competitive disadvantage. Regulations are the most effective tool large companies have to hammer their smaller and often better competitors into oblivion. So for all of you progressives "looking out for the underdog," how is putting the little guy out of business "Looking out for him?" If you will stop chanting your idiot mantra's just for a moment you might hear the desperate pleas of "little guy's" everywhere begging "Please stop helping!"

Lesson # 2 from Ben's book of deregulation for dummies. If you are a Progressive, please put down your Chai Latte for a moment, and try to follow along. Insurance companies cannot currently do business across state lines. This applies to the big guys, and the "little guys."  In reality, there are no "Little Guy's" in insurance. After all, who wants to be insured by a little guy with little resources, who could be put out of business by the smallest run on their resources.  So, far from limiting these companies the regulations have actually created insurance Monopolies in each state. Republicans want to allow [and force] these companies to compete. Competition always lowers consumer prices. [Yes I know this is a no-brainer - be patient, I am trying to explain this to the liberals.] So OK, follow the slowly bouncing ball: "Allowing Competition Is Deregulation." It's maybe not as simple or as catchy as "Deregulation Bad," or "Polly wants a Cracker," but it is a fact, and I am inviting any Progressives reading this to join us in our fact-based universe. Deregulation is what happened to Ma-Bell in the eighties, which is why you don't have one phone company option at $300 per month.
Lesson # 3 from Ben's book of deregulation for Morons: "Deregulation" was not the cause of the bubble or the collapse of the bubble. Absurd feel good regulations created an artificial and unsustainable bubble that could not do anything but eventually collapse. The CRA and other Regulations forced banks to make loans that they knew would fail. They forced Banks to loan in sectors that had proven historically to fail like lemmings heading to a fun day at the beach. The government in return promised to absorb the impact when the inevitable collapse came, thereby passing the loss back to the little guy. This portal to shuttle the risk and the bad debt back to you and me we call Fannie, and Freddie. So the government says go ahead and hand out bad loans like Halloween candy to anyone that rings your doorbell and then just pass these bad loans to bigger banks, who will pass them to the Government insured Behemoths of Fannie and Freddie, who will then just pass them to us, and we will pass them on back to the little people, all the while blaming corporate greed. Oh, and meanwhile we will hopscotch back and forth between our executive jobs at these "Evil" ginormous banks and government jobs created to "oversee and regulate them," raking off millions from these companies that we were "regulating" and excoriating the week before from our government perches.

So now President OBags-a-money and his bevy of  former Wall Street Fat Cats now working for him are going to stick it too these greedy bastards. They are going to create new regulations to protect the little guy. Why does that sound to me like Deja Vu all over again? Tell me, how are the previous round of regulations to protect the little guy working out for you so far? So, OK, OK, I know, the the Progressive mission statement must prevail: "If something has been proven to be a bad idea do it on a larger and larger scale until it works." If you will stop squawking your mantras for even a moment and pay attention you might notice that some of the most prolific recipients of Fat Cat contributions are the very guys now creating these new "consumer protections." If you pay attention at all you will see these same politicians pounding the podium with one fist and decrying these evil greedy bastards and promising crushing regulations while these same Fat Cats are shoving wads of cash into the other fist behind their back. Did you notice for instance that all of these regulations completely ignore Fannie and Freddie, who trade executives back and forth with the government at a pace that would make a world Ping-pong champion dizzy?

Lesson #4, from Ben's book of "Orwellian Government-speak for dummies: "Too Big Too Fail," is the tool that those who are in Companies who have found favor with the government [read: contribution/bribe] use to disassemble their competitors with the gleeful abandon of the neighborhood bully knocking over your Dominoes, your lovingly created house of cards or sticking a pin in your balloon with a loud "pop" and a sincere "Oh, sorry." If you stop your parroting of the latest slogan for just a moment you might notice that the largest, most government protected, and the most rife with politician/executive Ping-pong balls entities of Fannie and Freddie are once again specifically excluded from these "consumer protections." If anyone is to0 massive to fail would it not be Fannie and Freddie, who are ate the very top of the heap?

Who else by the way, is "Too Big To Fail?" Well, the term was specifically used to justify the massive and continuing infusions of taxpayer blood into those glorious examples of corporate thrift and innovation: GM and Chrysler. After all without raping the taxpayer to save all of these union jobs we may never again be blessed with such technological marvels as the Pinto, The Gremlin, The Pacer, the Edsel, and the Corvair. And isn't it interesting that these same government money vending machine-politicians that rained down money on Chrysler and GM are now wagging their fingers at Toyota, promising to stomp on the necks of one of their primary competitors with the rapt attention of a cat atop a quivering mouse. Yep, no conflict there.

So, yeah, if we should start dismantling companies that are "Too Big To Fail," that "caused" the meltdown, perhaps we should start with those companies that are currently engaged in a deep french kiss with Washington, that have their hands deep in the pockets of our current savior-politicians. Perhaps we should start by dismantling Fanny and Freddie brick by brick and draining the corporate swimming pool of the ostensible tons of "spare" cash, and putting the public soaking executive/politicians in the driveway with the pile of other obsolete items for the Goodwill trucks to pick up. Next I say we dismantle GM and Chrysler into a bunch of competing little companies, and see how well they do against our foreign competitors who don't think it a winning economic policy to hobble their largest employers.

Or... perhaps we could as a society endeavor to actually exist in a fact based universe and actually learn something about how we are being used once again by the same Populist Preachers promising us the salvation of "Redistribution, Regulation, Rainbows, and lollipops."

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