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Neoliberalism: The Ideology That Dares Not Speak Its Name
#85
I'd like to pivot from privatization to another core element of neoliberalism: deregulation.  Ronald Reagan was not the only champion of deregulation: "In this present crisis, government is not the solution to our problem; government is the problem," he famously said in his 1981 Inaugural Address.  Jimmy Carter signed into law the Depository Institutions Deregulation and Monetary Control Act of 1980, which set into slow motion perhaps the most pernicious trend in deregulation: it loosened or eliminated many of the provisions of Regulation Q under the Glass-Steagall Act.  Almost overnight, the once boring and conservative financial industry began to change--and arguably not for the better.  I know, I was an AVP at the largest bank in the Southwest at the time.  (I left the following year, just as a Wild West mentality in commercial lending was taking hold in Texas; nine of the top ten banks in the Lone Star State subsequently failed.)

Deregulation gathered steam under Reagan.  I gave him kudos for eliminating Nixon's price controls, which only exacerbated inflation psychology at the time.  Reagan also removed controls on oil and gas, cable television and long-distance phone service, among other deregulatory actions.  But unfortunately, he furthered the trend of bank deregulation, signing into law the Garn-St. Germain Depository Institutions Act in 1982, which removed restrictions on loan-to-value ratios for savings and loan banks.  That, combined with Reagan's budget cuts reducing the regulatory staff at the Federal Home Loan Bank Board, led banks to invest in risky real estate ventures.  All of which contributed largely to the Savings and Loan Crisis of 1989, and which roughly echoes the eventual disastrous effects of repealing the Glass-Steagall Act on Bill Clinton's watch.

The point is, both Democrats and Republicans have played their part in deregulating key industries, banking foremost among them in terms of posing systemic risk to the entire global economy.  And it is the financial industry, perhaps above all others, that bears close watching in a Trump administration.  Early indications are not at all encouraging:

"Why Trump's Dodd-Frank Replacement Is Dangerously Weak"
http://theweek.com/articles/669774/why-t...ously-weak

"Make Banks Great Again? G.O.P. Push to Ax Key Agency Poses Risks"
https://www.bloomberg.com/news/articles/...oses-risks

Indeed, the cabinet nominees and transition team that Trump is gathering around him promises all manner of deregulation, some of which may aggravate wealth and income inequality, increase the predation of Wall Street, strip consumer protections, and worsen the impact of climate change.

"Trump’s Pick for Labor Secretary Wrote a Deregulatory Manifesto"
https://www.propublica.org/article/trump...-manifesto

"Trump to Tap Wall Street Lawyer Jay Clayton to Head SEC"
https://www.washingtonpost.com/news/wonk...956d7d5c94

"Mnuchin Nomination for Treasury Shines Harsh Light on U.S. Politics"
http://wallstreetonparade.com/2017/01/mn...-politics/


"Billionaire Carl Icahn Will Lead Trump’s ‘Deregulatory Charge,’ Consumer Advocate Says"
http://www.truthdig.com/report/item/trum..._1pY.gmail

"Trump Picks Top Climate Skeptic to Lead EPA Transition"
https://www.scientificamerican.com/artic...ransition/






  [url=http://theweek.com/authors/jeff-spross][/url]
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RE: Neoliberalism: The Ideology That Dares Not Speak Its Name - by TeacherinExile - 01-06-2017, 03:43 PM

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