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More Continuity From the Second of America’s Two Interchangeable Neoliberal Parties

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the-wolf-of-wall-street

Thankfully, the candidate of Goldman Sachs lost:

U.S. President Donald Trump on Friday will fire the opening salvo in his campaign to scale back major regulations that resulted from the financial crisis, directing a review of the Dodd-Frank Act and putting the brakes on a retirement advice rule.

The executive order Trump will sign on the 2010 Dodd-Frank law on Wall Street reform will be a first step towards rolling back the regulations that Trump sees as hurting the economy, but without rewriting the legislation, which can be done only through Congress. One prominent measure is the “Volcker rule” that greatly restricts how banks can make bets with their own money.

Expectations of simpler bank regulations helped push up stocks on Wall Street in early trading.

[…]

On Friday, the Republican-led Congress killed a Dodd-Frank regulation regarding payments that big energy companies make to foreign governments. Also, the House Financial Services Committee is working on a complete Dodd-Frank revamp.

[…]

The Labor Department’s retirement advice rule, set to take effect in April, is not part of the Dodd-Frank law, but has long been a thorn in the side of the financial services sector.

Issued by the Obama administration in 2016, the rule requires brokers to act as “fiduciaries,” or in their clients’ best interests, when they are advising them about their individual retirement accounts and 401K plans.

That is a departure from the current legal standard, which requires brokers only to recommend investments “suitable” to their clients.

Complying could cost firms as much as $31 billion over the next decade, according to Labor Department estimates.

Trump plans on Friday to issue a memo asking the Labor Department to determine whether the rule should be revised or be scrapped altogether, according to the White House.

“We think that they have exceeded their authority with this rule and we think this is something that is completely overreaching,” the official said.

Opponents of the rule argued it would raise costs and make small accounts unprofitable.

It’s far from the worst thing that will result from this election, but the fact that one of the first Republican policy moves is to restore the inalienable right of retirement savers to be ripped off by unscrupulous parasites is highly instructive. You also have to love the justification of the advisers — “there’s no money in acting in the interests of our customers!” Well, OK then.

Anyway, here’s some free advice for those lucky enough to have retirement savings: low-churn index fund, because paying people commissions for knowledge they don’t actually have and whose business model literally depends on not acting in your interest is a terrible idea. You’re welcome.

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