Regulatory Capture, Captured on Video

It is a sad thing that our officials turn an eye to crime so they and their families can secure a future in the industries they regulate. Unfortunately there seems no reason for them to do their jobs responsibly when they and their families benefit from the revolving door from public service to the more profitable positions in the private sector.

Regulatory Capture, Captured on Video

SEC official slobbers over private equity titans, suggests his son might want a job in the field

This is courtesy of Yves Smith over at Naked Capitalism, who's been following the strange story of SEC Examination chief Andrew Bowden's evolving position on financial corruption for a while.

That story blew up recently in a remarkable public appearance by Bowden, in which the would-be enforcement official cravenly compliments the industry he supposedly polices and then — get this — jokingly puts forward his own son as a candidate for a job in private equity. On video. You won't see a more brazen example of regulatory capture anywhere.

source

Tax the rich!

They will not go hungry!

Jail for these criminals that are destroying finances of 99% of the worlds citizens for their own gains.

a reply to: AlaskanDad

God forbid someone makes a joke... It is pretty obvious watching the video it was said tongue and cheek. Good grief.

a reply to: AlaskanDad

Like I just said in another thread, they don't even try and hide it anymore.

The only fix to these self-aggrandising narcissists is total collapse and reset.

a reply to: AlaskanDad

Yes, this is what we call corruption, crony capitalism, the revolving door between state personnel and the companies they benefit. It is the primary argument against the regulatory state. Another is the damage that they cause to our economy through the intentional and authorized interference which they levy against the opponents of those chosen companies.

It does not represent free market capitalism in any way.

a reply to: Edumakated

Just a joke????


Want to bet on which field his son finds employment in???

Does bootlicking for the rich get tiresome????????

originally posted by: AlaskanDad
a reply to: Edumakated

Just a joke????


Want to bet on which field his son finds employment in???

Does bootlicking for the rich get tiresome????????

Does complaining about people who are more successful than you get tiresome? If you spent as much time improving your own lot in life instead of bashing others, you too might see big paychecks. PE serves an important function in our economy. Who do you think is keeping returns high enough so pensions can be paid out to blue collar workers? They are often the largest investors in PE funds.

originally posted by: Edumakated
Does complaining about people who are more successful than you get tiresome? If you spent as much time improving your own lot in life instead of bashing others, you too might see big paychecks. PE serves an important function in our economy. Who do you think is keeping returns high enough so pensions can be paid out to blue collar workers? They are often the largest investors in PE funds.

I think your lost on the wrong public chat forum. Your opinion seems about as opposite to the norm around here as humanly possible.

originally posted by: AlaskanDad
It is a sad thing that our officials turn an eye to crime so they and their families can secure a future in the industries they regulate. Unfortunately there seems no reason for them to do their jobs responsibly when they and their families benefit from the revolving door from public service to the more profitable positions in the private sector.

I agree. This system of spending some years in government regulation then jumping into high paying jobs with your contacts and insider knowledge is clearly inappropriate.

I suggest a radical solution. Hire public servants for lifetime! Just like a judge in Canada is given a job for life and can only be fired for gross misconduct...do the same with key decision makers in the public service. This helps 'remove' any profit motive as they are 'set for life'. As well they don't fear some politician axing them if they don't lick boots. They can go after corruption without fear...well...except fear of a bullet of course.

Regulation which is essentially a complicated web of thousands of pages of rules, requirements and legal jargon essentially exists to ensure that the big end of town has enough loopholes to operate through, while smaller competitors dont have the resources to cope with it. it is a competitive advantage for the biggest companies, and essentially an anti-competitive tool as it makes the barriers to entry prohibitive for new entrants. This is true of all industries, and is the reason you will see industry bodies lobby for regulation, especially for the regulation of innovative sectors that could threaten a status quo. This naturally leads to regulatory capture as the industry and regulators are all moving in the same direction.

US financial regulators compete against each other to ensure their survival and essentially grovel to the companies they supervise (the companies can, and do, threaten to relocate to other states if the regulator becomes too aggressive). Regulators have no real power as a result. The entire machinery of regulation in the US needs to be dismantled and rebuilt, because it is broken beyond repair.

On the other hand, a principles-based approach which is less complicated in terms of rules and ratchets up requirements the bigger and more complex the companies get can actually work to some extent, and without regulatory capture if you genuinely keep some form of independence in the regulator's charter. I've seen how this works first hand, and it can work.

Public servants being hired for life simply wont work, as it eliminates much of the performance incentives and leads to really poor outcomes and far less capable and talented regulators. I dont have an issue with regulators moving to the private sector, it can often bring different skills into private sector companies (such as risk management) and a different culture. All that, however, is predicated on the regulator actually doing its job in the first place and not simply being a tool of industry.