An anti-derivatives reform report backed by pro-business groups, apparently spear-headed by the U.S. Chamber of Commerce, is under fire today because of some excellent reporting by the New York Times' Andrew Ross Sorkin. The report "claims that proposed regulation could cost 130,000 jobs and could cut corporate spending by $6.7 billion."
The study was conducted by Keybridge Research, a seemingly independent economics and public policy consulting firm. The firm’s bona fides include an all-star roster of academics, including Joseph E. Stiglitz, a Nobel laureate in economic science; David Laibson, a professor of economics at Harvard, and Stephen P. Zeldes, a professor of economics and finance at Columbia’s Graduate School of Business.
But a closer look at the report raises some serious questions. For one, the findings seem oddly out of step with the views of some of the group’s luminaries, including Mr. Stiglitz, who is advertised on Keybridge’s site as an adviser.
How could that be?
Well, it appears that Mr. Stiglitz and many of the firm’s advisers are not advisers at all.
Sorkin contacted the "firm’s other so-called advisers" and found that some of the academics listed as Keybridge's affiliated advisers have no knowledge of their affiliation, and meanwhile "names mysteriously disappeared from the group’s site on Monday. By the end of the day, Keybridge’s list of affiliated advisers had shrunk to four, from seven." For his part, Stiglizt said he had done some work for the firm back in 2009.
The study appears to have been done for the Chamber of Commerce and its “Center for Capital Markets." As Yves Smith points out, "Keybridge’s president does not even try to pretend that the study was prepared to offer a fair minded assessment: 'the client had asked us…. It was a hypothetical study.'" In other words, we gave the Chamber what the Chamber asked for.
This coming in the middle of the HBGary scandal, in which the Chamber was apparently willing to contract for services "that included cyberattacks and misinformation campaigns, phishing emails and fake social networking profiles, pressuring journalists and intimidating the financial donors to clients’ enemies including WikiLeaks, unions and non-profits that opposed the Chamber," is another black eye for the organization. It appears that the Chamber will go to any length to achieve its goals.