The Dodd-Frank financial regulation bill of 2010 will help the big banks by adding complexity and overhead costs that widen the protective “moat” around the biggest guys. I’ve been arguing this all along, and today JP Morgan CEO Jamie Dimon agrees.
Here’s the report from an interview with Dimon (via The Business Insider):
This reminds me of how Goldman Sachs CEO said “we will be among the biggest beneficiaries of” the bill. Of course, all along, we’ve seen this. Here’s the bank lobby, in early 2011, saying “hands off Dodd-Frank.”
This all means more bank consolidation, which, of course, exacerbates the problem of too big to fail. I think billionaire Obama fundraiser Warren Buffett agrees with Jamie Dimon, and that helps explain his bullishness on big banks.
Big business benefitting from regulation, at the expense of smaller players and (I believe) consumers, is standard. Here are some more examples:
- Mattel, the world’s largest toymaker, supported strict new federal toy-safety regulations
- Philip Morris, the world’s largest tobacco company, supported strict new federal tobacco regulation.
- Wal-Mart, the nation’s largest non-government employer, supported a higher minimum wage and an employer-mandate in health insurance.
- GE supported strict efficiency standards on light-bulbs.
- Nike supported climate-change rules that crush its smaller competitors who actually make things in the U.S.
- H&R Block supported new IRS regulations on tax preparers.
- Big food producers supported new food-safety regulations.
- The financial planning industry group called for more federal regulation of financial planning.
- Hedge-fund giant Jim Chanos advocated federal registration of hedge funds.
- The American Bankers Association applauded new federal credit-card regulations.
- Portland cabbies pushed for cab regulations.
- The big trucking companies supported new trucking regulations
