GOP Takes Us Back To 2007, Ignores The Future

In early June of 2016, I wrote that the Republican legislative agenda was basically to roll back everything that the Obama administration had done. It had virtually no forward-looking proposals at all. Now that they are in power, they are going to make good on those promises to their corporate overlords.

Employing a rarely used law, the Congressional Review Act, that was passed in the mid-1990s that allows Congress to repeal federal regulations made since mid-June of 2016 with a simple majority vote and the President's signature, the Senate and the House separately repealed two Obama-era initiatives. These bills will be passed by the other house of Congress today and probably signed by Trump before the weekend is out.

The House repealed the Stream Protection Rule that protected the nation's waterways from pollution created by surface mining. The rule essentially made the coal mining technique of mountaintop removal uneconomic. The GOP had called the rule an attack on coal mining companies and they will claim that the repeal of this law will bring back coal mining jobs. That is highly dubious since wind and solar energy alternatives are now even cheaper than the already depressed price of coal. It will be a gift to the coal mining companies who can possibly go back to destroying the environment to squeeze out the last remaining dollars from a dying industry.

In the Senate, the GOP claimed that oil and gas companies were being put at a competitive disadvantage due to the Resource Extraction Rule that required publicly traded oil, gas, and mining companies to disclose payments to foreign governments. This rule had already been adopted in the EU, the UK, and Canada and the US was actually a latecomer in adopting it, partly due to legal challenges and delaying tactics by the companies being regulated. Repealing this rule will have three negative impacts. First, it will basically allow US oil, gas, and mineral companies to bribe foreign officials in order to obtain licenses and permits. Of course, we know that will never happen. Second, without this kind of disclosure, the citizens of the countries' whose resources are being extracted will have a harder time keeping their government accountable for the revenue generated by these deals since they will now not necessarily have any information about them. Lastly, it could actually have negative implications for investments in the oil, gas, and mining companies. Investors will be flying blind without this information and their returns could be wiped out if, in fact, a bribery scandal is uncovered.

Yesterday, the House repealed a Social Security Administration rule that reported disability patients with mental disorders to the national gun background check system, with the idea that you may want to raise some sort of red flag when a mentally ill person wants to buy a gun. Specifically, the rule did not prevent mentally ill people from buying a gun, it simply added their name to the background check system. Six Democrats voted for this repeal and they really should all be primaried.

A Wall Street Journal article today says that the Trump administration is looking to roll back the Dodd-Frank legislation that attempted to reform the financial industry after the financial collapse which nearly brought the world economy to its knees. One of the successes of Dodd-Frank was the requirement for banks and large financial firms to increase their capital in order to better withstand a collapse like 2008. In addition, the law has reduced trading revenues and increased lending, which really is the point of a financial industry, isn't it. In usual Trumpian bloviating, he will sign an Executive Order announcing his intention to roll back the law. In actuality, it will be difficult to do that and he will need the help of Democrats to do so.

But one gift he can give his Wall Street cronies is to use the CRA to repeal another rule that required financial advisers to act in the best interest of their client. Prior to this rule, financial advisers could present recommendations of suitable investments that paid higher fees and higher commissions when there were clearly similar investments with lower fees and lower commissions available. The Obama rule prevented that practice and required the financial adviser to present a range of suitable investments that included the low fee, low commission option. This prevented millions of investors from getting the maximum return while lining the pockets of the financial industry and its salesmen. The new rule would have created a race to the bottom as financial services companies would have to really compete on fees and commissions. Which is, of course, why Republicans will repeal it.

There will be more atrocities to come, you can be sure. But, with the exception of maybe a few hundred jobs in the coal industry, it is hard to see how any of these move by Republicans will help bring back jobs or put money in the wallets of working and middle class Americans. They are simply big gifts to major corporations. And, rather than providing any forward-looking legislation that will help American workers deal with the technological challenges ahead of them, the GOP is simply taking us back to 2007.