"Issa: Bailouts Are Not Smart Reform"

[WhiskeyGirl]

America needs smart financial reforms that protect investors from fraud, address government regulatory failures and keep the government in the role of an unbiased quality-control technician instead of a corporate owner or bailout backstop. But if the Democrats in Congress get their way, we can expect more bailouts, more centralized control of our economy and more waste, fraud and abuse.

Indeed, when regulators are given unchecked power and limitless discretion, they become unmanageable. Too often, large federal agencies are swollen fat on the taxpayers’ financing, and with no profit-driven pressure to keep costs down, they end up wasting taxpayers’ money. Moreover, unchecked regulators are susceptible to abuses of power that deliberately favor some particular faction or constituency. And sometimes, unsupervised regulators and the largest business interests team up to scratch one another’s backs. We call that crony capitalism.

Americans deserve smart financial regulatory reforms that simplify agencies like the SEC to reduce waste and restrain the Fed and others from arbitrary abuses of power. Smart reforms would end crony capitalism by cutting off taxpayer support of Fannie and Freddie and reinstitute capitalism’s existing mechanisms — namely, failure and bankruptcy — to punish bad behavior and encourage prudence. Impartial judges must handle corporate failures, not federal regulators. Indeed, regulators must be given less discretion, not more.

more here - http://www.rollcall.com/features/Financial-Regulatory_Reform/finance/45957-1.html