Saturday, March 12, 2011

Republicans Advocate in Favor of More Madoff-Like Financial Scams

The second post in my mini-series about the budget, since we (especially those of us who work for the U.S. government) are wondering if Congress is ever going to get around to passing a budget to avoid a government shutdown next Friday night.

I firmly believe that budgets are moral documents. Since people, organizations, etc. can say whatever they like (i.e. "talk is cheap"), the only way to see what's really important to a person, an organization, a business, a government, a non-profit, etc. is to look at their budget - to see what they spend their money on.

Now that I work in government, I am more aware than ever of the extent to which money, and ONLY money (which includes people's time, since people's time costs money), reveals a person's, group's, or organization's priorities.

In that vein, when I look at Republicans' proposed budget cuts, I can only see what I see as poorly thought out, irrational, and/or immoral priorities. Much of the $61 billion in cuts that Republicans are seeking to current budget for the rest of this fiscal year (i.e. government spending from now until September 30) falls on the most vulnerable members of society - low-income families, communities of color, children, low-income college students, and rural areas. They are demanding these cuts after going to the wall to get additional tax cuts for the wealthy in December - $81.5 billion extra in tax cuts in 2011 and 2012 for households earning more than $250,000.

From a financial perspective, tax cuts are the exact same as government spending - so the Republicans are far more concerned with spending money on tax cuts to the already-rich rather than maintaining the social safety net for the most vulnerable members in U.S. society. So much for helping Jesus by helping "the least of these my brothers."

However, what I really want to focus on in this post is the Republicans' attempts to defund financial regulation reform. As pointed out by The Big Picture, the Republicans' budget seems to show that they are hell-bent on enabling more Madoff-like financial scams. As shown by this chart, the SEC's workload has increased dramatically over the past two decades, while the human resources available to the SEC to do this workload have not grown in tandem with the workload:

Percent Change SEC Staff Workload: 1991 – 2000
Source: The Big Picture. Original Data from GAO.
In their blind, irrational opposition to anything Obama has ever said or done, the Republicans want to dramatically slash the budgets of the government agencies responsible for regulating U.S. financial markets, increasing the probability of both Madoff-like scams and financial crises like the one we are currently coming out of.

If budgets are moral documents, what does the Republicans' budget say about them?

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