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I totally get that piece, but I feel like in some ways it is meant as an attempt to deflect conversation away from what is stated to be a factor: "The oft-cite

I totally get that piece, but I feel like in some ways it is meant as an attempt to deflect conversation away from what is stated to be a factor: "The oft-cited explanations—campaign contributions and the allure of private-sector jobs to low-paid government lawyers—have certainly played a role." Emphasis on "have certainly played a role." The moment I hear that, I ask why the hell we aren't focusing the conversation there and keeping it there. Guarantee a lot of the "lack of balls" has to do with worrying about future security in the form of campaign contributions and private-sector jobs. How about we solve for that problem first and see if they still lack balls when they are no longer worried about their financial future being directly tied to those they are supposed to police.

deleted 11y ago
[deleted]
rayiner 11y ago
Who at SEC is elected? How does the prospect of going into a private sector job (usually at a law firm which makes money from banks getting in trouble), dissuade anyone from taking down a big Wall Street player?
- chishaku 11y ago
  Federal agencies are ultimately responsible to Congress and the President. The recent (last 20 years) trend towards deregulation and lax enforcement (IMO) starts at the top but most visibly manifests in the actions or inaction of regulators like the SEC.
- Uhhrrr 11y ago
  * Regulators might be unofficially blackballed from companies in return for doing their jobs too well. * If regulators hurt the industry they're regulating, it means fewer jobs will be available for them when they switch to the private sector.
  - rayiner 11y ago
    Holding bankers accountable would not "hurt the industry." The health of the industry is driven by non-government market factors. Indeed, aggressive enforcement means more private sector job opportunities for regulators. SEC lawyers generally don't go to banks--they go into private practice law firms. Those firms make money when banks get in trouble. The recent financial collapse was actually good for financial litigation departments. Looking at it another way: the amount of demand in antitrust litigation is much lower these days than it was 30 years ago when the DOJ was much more aggressive about antitrust enforcement. I just don't think the narrative about regulators going easy because they're hoping for a sweet gig at Goldman is consistent with what happens or even a theoretical analysis of peoples' incentives. Ultimately, it's politics. Bill Clinton implemented massive deregulation in the financial industry. Regulation is seen as an illegitimate intrusion into the market's operation. So long as that is the case, regulators will avoid being aggressive for fear of provoking a political backlash.
    - Uhhrrr 11y ago
      > Holding bankers accountable would not "hurt the industry." Does losing money hurt an industry? Can overregulation hurt an industry? > SEC lawyers generally don't go to banks--they go into private practice law firms. Those firms make money when banks get in trouble. Yes, they make money from banks when banks get in trouble.
      - rayiner 11y ago
        We are talking about enforcement here. Putting bankers in jail instead of imposing a large fine on the corporation saves the banks money. > Yes, they make money from banks when banks get in trouble. Sure, but in an environment of weak enforcement where banks never get into trouble, there isn't any money to make.
        enraged_camel 11y ago
        >>We are talking about enforcement here. Putting bankers in jail instead of imposing a large fine on the corporation saves the banks money. Maybe you live in a different reality, but in ours, the massive reputation hit the bank would suffer from having its employees go to jail would be tremendously more costly than meager fines that they can just shrug off.
- spinlock 11y ago
  I think Goldman would pay more to hire an sec investigator with balls. They'd be the ones causing problems and worth buying.
- deleted 11y ago
  [deleted]
ArkyBeagle 11y ago
The effect of campaign contributions is unmeasurable at this writing. If we want to allow public service by government lawyers to be a farm system for big finance houses, then we can continue to underpay them.

deleted 11y ago

[deleted]

rayiner 11y ago

Who at SEC is elected? How does the prospect of going into a private sector job (usually at a law firm which makes money from banks getting in trouble), dissuade anyone from taking down a big Wall Street player?

chishaku 11y ago
Federal agencies are ultimately responsible to Congress and the President. The recent (last 20 years) trend towards deregulation and lax enforcement (IMO) starts at the top but most visibly manifests in the actions or inaction of regulators like the SEC.
Uhhrrr 11y ago
* Regulators might be unofficially blackballed from companies in return for doing their jobs too well. * If regulators hurt the industry they're regulating, it means fewer jobs will be available for them when they switch to the private sector.
- rayiner 11y ago
  Holding bankers accountable would not "hurt the industry." The health of the industry is driven by non-government market factors. Indeed, aggressive enforcement means more private sector job opportunities for regulators. SEC lawyers generally don't go to banks--they go into private practice law firms. Those firms make money when banks get in trouble. The recent financial collapse was actually good for financial litigation departments. Looking at it another way: the amount of demand in antitrust litigation is much lower these days than it was 30 years ago when the DOJ was much more aggressive about antitrust enforcement. I just don't think the narrative about regulators going easy because they're hoping for a sweet gig at Goldman is consistent with what happens or even a theoretical analysis of peoples' incentives. Ultimately, it's politics. Bill Clinton implemented massive deregulation in the financial industry. Regulation is seen as an illegitimate intrusion into the market's operation. So long as that is the case, regulators will avoid being aggressive for fear of provoking a political backlash.
  - Uhhrrr 11y ago
    > Holding bankers accountable would not "hurt the industry." Does losing money hurt an industry? Can overregulation hurt an industry? > SEC lawyers generally don't go to banks--they go into private practice law firms. Those firms make money when banks get in trouble. Yes, they make money from banks when banks get in trouble.
    - rayiner 11y ago
      We are talking about enforcement here. Putting bankers in jail instead of imposing a large fine on the corporation saves the banks money. > Yes, they make money from banks when banks get in trouble. Sure, but in an environment of weak enforcement where banks never get into trouble, there isn't any money to make.
      - enraged_camel 11y ago
        >>We are talking about enforcement here. Putting bankers in jail instead of imposing a large fine on the corporation saves the banks money. Maybe you live in a different reality, but in ours, the massive reputation hit the bank would suffer from having its employees go to jail would be tremendously more costly than meager fines that they can just shrug off.
spinlock 11y ago
I think Goldman would pay more to hire an sec investigator with balls. They'd be the ones causing problems and worth buying.
deleted 11y ago
[deleted]

ArkyBeagle 11y ago

The effect of campaign contributions is unmeasurable at this writing. If we want to allow public service by government lawyers to be a farm system for big finance houses, then we can continue to underpay them.