Thursday, November 4, 2010

Catch of the Day

Via Yglesias, here's one from Tyler Cowen:
Mr Bachus told the FT that he would go “page by page  [through Dodd-Frank]. . . to identify job-killing provisions or lending-killing provisions”. He highlighted new rules pushing over-the-counter derivatives trading through clearing houses and on to exchanges as a problem for non-financial corporate users.

“The derivatives provisions in Dodd-Frank alone... as they stand now they’re going to take a trillion dollars out of our economy. Think how many jobs that’s going to kill,” he said.

It is difficult to fathom how that last pararaph (article here) can make any sense, other than as fabrication.  What is the public choice factor here?  Ag producers who trade customized swaps and who wish to keep doing so?  Or is it financial institutions, including the trading branches of commodities firms, which earn money trading the spread?  How about traders which don't want to deal with the potentially onerous margin requirements at a newly established clearinghouse?  All of the above?
All pols spin; all pols stretch the facts in their direction; no one should ever assume that any pol gets his or her facts right.  Still, it's worth emphasizing the extent to which the conservative feedback loop allows lazy GOP pols to parrot nonsense from lobbyists or right-wing yakkers without any need to fact-check or conform to reality.  This is an example of the former, apparently; follow the comments in the above-cited post, and you'll find the interest group press release from which Bachus got his "information." 

This does not work well in the long run, as the DeLay Congress found out in 2006 (and, for that matter, in 1998).  At least not for Members in marginal seats, which -- presto! -- the GOP suddenly has plenty of.  Of course, pols in safe seats can get away with all sorts of things more or less forever, and given the realities of the partisan media environment, they don't really even have to worry about marginally uncomfortable interviews in which they're challenged with reality-based questions.

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