Secretary Geithner: Regulations Will ‘Raise Costs of Business’ but that is ‘the Necessary Outcome’
Washington,
October 12, 2011 -
Treasury Secretary Timothy Geithner offered a revealing insight into the Obama Administration’s attitude about regulations on Thursday when he testified before the Financial Services Committee.
After Oversight and Investigations Subcommittee Chairman Randy Neugebauer told the Secretary he is worried about the cumulative impact that the Dodd-Frank Act’s 400 regulations will have on the economy, Secretary Geithner responded: “I think you are too worried about the cumulative impact of these financial reforms on the basic business of finance in the United States.”
As the exchange with Rep. Neugebauer continued, Secretary Geithner conceded the new Dodd-Frank rules being drafted by regulators will burden the private sector with increased costs, but that – according to the Secretary – is their point:
“Now they have consequences. They will raise costs of business for
financial institutions. That is their objective, in some ways, or that is
the necessary outcome of that stuff.”
That’s an amazing admission from the Secretary. The “objective” of these regulations, he says, is to “raise costs” for businesses. Not only is that “their objective,” but it is “the necessary outcome”. That will indeed “have consequences” – fewer jobs.
Whether it’s Obamacare, Dodd-Frank or the EPA, one thing this Administration is good at is creating more of “that stuff,” to use Secretary Geithner’s colloquial term. The website of the President’s Office of Information and Regulatory Affairs shows there are 4,257 new regulatory actions in the works, of which at least 219 will have an economic impact of $100 million or more.
Officials in the Obama Administration may not be worried about the cumulative impact all these Dodd-Frank regulations are having, but job creators certainly are – and with good cause.
- Gordon Logan, founder and CEO of Sport Clips Haircuts, told POLITICO his men’s salon franchise could have added more than 50 locations were it not for Dodd-Frank Act regulations.
- ‘Colorado bankers say regulations are killing off business loans,’ reads a headline from the Denver Post.
- A recent column in the Washington Times points out that the Treasury Department estimates businesses will have to set aside more than $2 trillion in working capital to comply with new regulations on derivatives.
- New Mexico’s chief financial regulator says Dodd-Frank regulations will have a profound effect on the economy – “and not for the good.”
- “No other President has burdened businesses and individuals with a higher number and larger cost of regulations in a comparable period,” reports the Heritage Foundation.
- Employment at regulatory agencies is up 13% since President Obama took office, but private sector jobs are down by more than 5%.
