Republicans label allegations that bank failures can be attributed to deregulation as “hackish”

by | Jan 23, 2024 | Bank Failures | 22 comments

Republicans label allegations that bank failures can be attributed to deregulation as “hackish”




A Republican lawmaker was very offended that anyone might suggest that bank are failing because of deregulation. Ana Kasparian and Cenk Uygur discuss on The Young Turks. Watch TYT LIVE on weekdays 6-8 pm ET.

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“The Republican lawmaker overseeing the House investigation into the ongoing banking crisis told an influential bank lobbying group last week that it was “hackish” to blame deregulation for recent bank failures — including the collapse of an institution that’s been his top individual source of campaign cash.

Rep. Patrick McHenry (R-N.C.), who has received $275,000 in donations since 2013 from executives at Signature Bank, will lead the House Financial Services Committee’s first hearing on Wednesday looking into the sudden failures of Signature Bank and Silicon Valley Bank (SVB) earlier this month.

One key factor in Signature Bank’s collapse was its decision to aggressively pursue cryptocurrency companies’ deposits before the crypto market imploded. McHenry, who benefited last election cycle from nearly $170,000 in spending by a pro-crypto super PAC, has been an avid supporter of the industry, which is built around digital money or assets.

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In recent years, there has been a heated debate about the causes of bank failures and the subsequent financial crisis. Many have pointed fingers at deregulation as the primary culprit, arguing that the loosening of government regulations on the financial industry led to risky behavior and ultimately, the collapse of several major banks.

However, according to Republicans, blaming bank failures on deregulation is “hackish” and oversimplifies a complex issue. They argue that it is a convenient and politically expedient way to shift the blame away from other contributing factors.

One of the key arguments from Republicans is that while deregulation may have played a role, it was not the sole cause of the financial crisis. They point to other factors such as the housing bubble, subprime lending, and the failure of rating agencies to accurately assess the risk of complex financial products. They also argue that government intervention in the housing market, through policies that encouraged homeownership for low-income borrowers, contributed to the crisis.

Furthermore, Republicans contend that deregulation is not inherently bad. They argue that a certain level of regulation is necessary to prevent fraud and abuse, but excessive regulation can stifle innovation and economic growth. They point to the Dodd-Frank Wall Street Reform and Consumer Protection Act, which was passed in the wake of the financial crisis, as an example of overreach. They argue that the law has burdened banks with costly compliance measures, which has put a strain on their ability to lend and support economic growth.

See also  Senator Kennedy strongly criticizes Biden for bank bailouts

Additionally, Republicans argue that blaming deregulation for bank failures ignores the role of individual responsibility. They argue that banks and financial institutions should be held accountable for their own actions and decision-making. They believe that the market should be allowed to function with minimal government interference and that a free market will naturally weed out bad actors.

Overall, the Republican stance on blaming bank failures on deregulation is rooted in a belief in limited government intervention and individual responsibility. They argue that the financial crisis was a result of a combination of factors and that a more nuanced approach is needed to address the root causes and prevent a similar crisis from happening in the future.

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22 Comments

  1. @bobwilson3980

    In the means time we need to deregulate more smaller banks especially mine.

  2. @jeffmccrea9347

    Yeah, and if you believe that bank failures AREN'T caused by REPUGNANTCON deregulation, I have some rock solid, flood zone 0, elevated, waterfront property in Brooklyn New York to sell you.

    …Knee jerk analysis?… Yeah, I tend to jerk when my bank knees me in the balls.

    "I'm a very stable genius." Donald, "THE LYIN' KING" tRUMP

    The problem is, few Americans actually need a stable built but, then again, if he gets elected again, more of us will be living in stables.

  3. @mrpumperknuckles1631

    TYT knows about as much about banking as they do about economics.
    In other words they know nothing about either…

  4. @nivanteng5282

    I'm surprised that second guy can talk with a whole d*** in his mouth

  5. @merbst

    Being a Republican is 'hackish'.

  6. @roccaflocca4312

    Trump kept saying his health care plan was coming in 2 weeks, over and over, for a full 5 years, because no one pays attention after 2 week. See: News cycle argument mentioned in this video.

  7. @roccaflocca4312

    I'm not an economist. But I have read a lot of the classic econ books. Deregulation is only a good thing when capitalist don't act entirely within character.
    Make sure you fully process that before you respond.

  8. @zachhenry8537

    Liquid means that you can sell them quickly. Stocks are also liquid even though they're volatile.

  9. @nickrouse8426

    I'm pretty left wing. And maybe the bank dude was right. We've only heard deregulation and woke. Maybe it's more elaborate?

  10. @lordsummerisle3894

    it sure would have been nice if the Democrats nominated that one guy who talked about breaking up the banks in 2016, instead of that creepy scary warmongering woman. I forget his name now, but that guy was pretty good back then. instead, Hillary was so awful, that a clown beat her in the presidential race.

  11. @pennyroper5859

    It’s true! The facts are the Orange Clown is completely at fault for all of it!

  12. @ekrenz5268

    Whelp we know who bribed them. Excuse me, donated to their campaign’s or organizations.

  13. @themadinspector

    Iceland threw all the bankers in prison for a year after the 2008 crash. That's a start.

  14. @davebyron-ch9ve

    Yes it is a capital failure, simple.

  15. @jeremyrangel8138

    Jesus Christ. Ana doesn't even know what a 'liquid asset' is, and yet she feels competent deciding how the entire financial system should be run. She never knows what the hell she's talking about, yet she's always confident in telling everybody else how the world should be.

  16. @philliphessel6788

    Cenk’s experience exemplifies the usual manipulation by the mainstream media. It’s ironic that the far-right venues crying, “Fake news!” are the very ones that routinely resort to outright fabulation.

    The mainstream technique is selective reporting, deciding which stories to give headline attention and which to bury in less prominent, timely and frequent coverage.

    Facts contrary to corporate bias can still be sometimes reported, but in a way designed to skew our attention away from them and toward the pro-corporate agenda.

  17. @aaronsande

    IT IS DEREGULATION. And risk.

  18. @philliphessel6788

    Banks profit from lending money at interest— but it’s other people’s money, so keeping a cash reserve sufficient to meet demands for redemption is very important.

  19. @philliphessel6788

    If you trust the bankers to regulate themselves, they’ve got some seaside property in Wyoming to sell you!

  20. @jonnickolas4577

    We all know it's biden and his spending policies that are at fault.

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