Don't Miss CAE Forum on How Dodd-Frank Hurts Small Business with Top Expert Peter Wallison
The timing couldn’t be better for American Experiment’s forthcoming lunch with Peter Wallison on May 4. Wallison’s target topic, the unintended consequences of the Dodd-Frank Act, has hit the headlines in the past week with a flourish.
So has Wallison, one of the top experts on the fallout from Dodd-Frank, the most burdensome financial regulations imposed by Washington since the New Deal.
But the tables are turning, due to the government’s setback in a federal court ruling in favor of insurance giant MetLife. Wallison wrote in the Wall Street Journal this week that the decision “bears watching well beyond Wall Street.”
“Federal district Judge Rosemary Collyer sent a shock through the financial community on March 30 by striking down the designation of MetLife as a systemically important financial institution (SIFI). Her opinion, released to the public last week, is more than a challenge to the authority of the Financial Stability Oversight Council (FSOC). It is a challenge to the power of the entire federal bureaucracy.”
FSOC is an unelected 15 member board made up of the federal regulatory agencies that oversee financial services. The council has the authority to single out financial firms like MetLife that “could pose a threat to the financial stability of the United States.” That designation triggers far-reaching regulation by the Federal Reserve, based on projections, rather than evidence of an actual problem.
“Judge Collyer’s decision challenges whether the council—or, for that matter, any other federal administrative body—can base its decisions on nothing more than a prediction about the future that is unsupported by evidence. The council’s designation of MetLife as a SIFI was clearly that. The financial conditions that might exist in the future, when MetLife might suffer “material financial distress,” are unknown and indeed unknowable.”
Wallison believes the ground-breaking challenge to federal regulators will reach the U.S. Supreme Court.
”…Judge Collyer found that the discretion provided to the council by Dodd-Frank violated the underlying policies of the Administrative Procedure Act, which authorizes courts to dismiss federal agency decisions that are not based on evidence. For this reason, the ruling has far-reaching ramifications.”
Peter Wallison will be the featured guest on Wednesday, May 4th, beginning at 12:00 pm at the Marriott Hotel in downtown Minneapolis. The lunch is the second of a series of quarterly forums focused on how liberal policies hurt the middle class, low wage earners and minorities.
Please join us as Wallison focuses on how the left’s Dodd-Frank legislation has been a boon to the largest banks, but has damaged community banks and thereby hurt the small businesses that rely on them for financing.
Wallison’s most recent published book, Hidden in Plain Sight: What Really Caused the World’s Worst Financial Crisis and Why It Could Happen Again, thoroughly investigates the financial crisis and the devastating events of 2008 and argues that US government housing policies were the principal cause of the financial crisis.