House Republicans are busy little beavers this week, and naturally
weakening Wall Street regulations is on the agenda:
The legislation would allow banks to dodge market transparency and government oversight by conducting trades through offshore affiliates. By simply booking a trade in a London-based subsidiary, for instance, banks could avoid U.S. standards -- even if work on the trade was actually conducted within the United States. The bill would also hamstring funding for a key agency, and make it easier for the largest banks to sue financial regulators over rules the banks don't like. [...]
Bank watchdogs are particularly concerned about the bill's offshoring provision. Only major financial centers like London and Frankfurt, Germany, would be eligible for this offshoring loophole, and Republicans say foreign oversight in those locations will suffice. But European bank regulators are internationally renowned for their laxity. JPMorgan Chase infamously lost over $6 billion in its London Whale trading debacle, named for the locale in which the bank's trader was placing his risky bets. German banks, meanwhile, are notorious for buying up mountains of bad debt in a long series of financial crises, including the current European mess with Greece and the 2008 U.S. housing calamity.
Funny how when it comes to weaker European finance industry regulations, Republicans are all for it, but when it comes to stronger European standards for paid sick leave, paid family leave, and other benefits for workers, the answer is hell no.
Like so many House Republican initiatives, this is unlikely to go anywhere as a stand-alone bill, but they may just be dedicated enough to sneak pieces of it into larger must-pass bills.