Archive for the ‘Business’ Category
Does the GOP actually hate the public? Of course, this is why all the Goldman Sachs people are part of the Trump Administration: to fight financial reform that would help the public (and to shut down the Consumer Financial Protection Bureau). David Sirota reports in International Business Times:
House Republicans voted to rescind a federal rule making it easier for states to offer basic retirement savings plans to millions of workers. As International Business Times reported last week, the chief sponsors of the bill have been heavily supported by campaign cash from the finance industry, which has lobbied against the plans.
“If Republicans succeed in rolling back DOL regulations, they will destroy the best chance 63 million American workers have of getting access to a retirement plan,” said Ghilarducci, who estimated that another 40 million Americans without coverage would also be prevented from accessing low-fee retirement savings plans if the GOP bill becomes law. “These states took the responsible first step to save their residents from a retirement crisis defined by low coverage and inadequate savings and protect their taxpayers from the fiscal crisis resulting from millions of indigent elderly. This would be a painful step backwards for the millions who are shut out from the dwindling number of employer-sponsored plans.”
The Republican sponsors of the legislation have argued that the government should not crowd out private financial firms, which offer such services. . .
Note that the Republicans have already killed a law that required private financial firms to offer advice in the best interest of the client. That was getting in the way of profits (when advice is offered that is in the best interest of the financial firm, which is the rule).
It can get depressing. I do not see that polluting waterways improves the general welfare, though it surely improves the bottom line for coal companies.
Caitlin Dewey reports in the Washington Post:
In late 2015, Daniel Lubetzky learned of a federal rule that puzzled him: Salmon, avocados, olives, eggs and tree nuts aren’t “healthy,” according to the Food and Drug Administration.
Lubetzky, the chief executive of snack brand KIND, had just received a letter from the FDA warning him to stop putting the term on the packaging of his snack bars. The agency’s labeling regulations — dating back to the height of the anti-fat craze — prevented even “good” fats from calling themselves healthy, while allowing the label on some high-sugar products.
Learning about the origins of the rule — and, later, trying to change it — Lubetzky concluded that his industry had too much power in how food policy is decided. On Wednesday, he launched a new public advocacy organization, called Feed the Truth, designed to explore, expose and “counteract” that sort of influence. He is now giving $25 million to fund the organization–$5 million now and $20 million more over the next decade — though he says he won’t have any role in deciding the organization’s approach beyond choosing three nutrition experts to choose the group’s board.
“I don’t want to talk to them. I don’t want to know who they are. I’m not going to forward them articles,” Lubetzky said. “The announcement will be done by us. After that, we’re cutting the cord — the decisions will be made by board members I’ve never met.”
Experts generally agree that the food industry’s influence over public health has gone too far. Political contributions from food and beverage companies have more than doubled in the past 18 years, and the industry spends billions to fund complementary research, finance “shadow” groups to advance its local agendas, and lobby regulators.
Michael Jacobson, the president of the Center for Science in the Public Interest and one of three prominent nutrition experts who will choose Feed the Truth’s board, said the industry’s political activities are vast. (The other early advisers are Marion Nestle, a professor of nutrition at New York University, and Deborah Eschmeyer, the former executive director of Michelle Obama’s “Let’s Move!” initiative.)
“Compared to that, [Feed the Truth] is a small organization,” Jacobson said. “$25 million is a nice chunk of dough. But no, it’s not $100 million.”
There are several major battlegrounds in this larger fight against food industry influence. One is labeling, Jacobson said, but not just of the sort encountered by KIND. Several powerful trade associations have also marshaled their lobbyists to fight front-of-package food labeling, which would more clearly identify less healthful foods, and the updated Nutrition Facts panel, which will explicitly call out added sugars.
The processed food lobby has also fought voluntary sodium reduction targets, which Jacobson says could save “tens of thousands of lives.” During a recent FDA comment period, dozens of public health departments and organizations urged the FDA to adopt the targets — while a number of well-funded trade groups, including the North American Meat Institute and the National Milk Producers Federation, opposed it.
“The industries with the most political clout and the deepest pockets tend to sway the way things go,” said Andy Bellatti, the strategic director of Dietitians for Professional Integrity, a professional group. . .
I highly recommend reading the entire article, though it’s depressing: the drive to maximize profits has been extraordinarily corrupting, as the article shows.
The NY Times editors write:
There is no overstating how unprepared Americans are to retire. Nearly half of private-sector employees — some 55 million people — do not have an employer-provided retirement plan. Most of them are low- to middle-income earners who will end up relying on Social Security for between half and all of their income in retirement.
And yet, as early as Wednesday, House Republicans are expected to pass a measure to thwart efforts by California, Illinois and other states to establish basic retirement savings plans for employees at companies that do not offer such coverage. In California, for example, participating employees would have a small percentage of pay deducted from their paychecks, unless they opted out. Those amounts would be pooled and managed by investment professionals chosen by the state in a bidding process; the plan would be overseen by a board of government and business leaders appointed by the governor and the Legislature.
Financial firms claim that the plans represent unfair government competition. That’s false, but that doesn’t seem to concern House Republicans as they use a fast-track process to derail the states’ plans, siding with the financial industry over ordinary savers.
First, under the plans, states establish the legal framework for deducting contributions from employees’ paychecks, but they do not run the plans. Second, state plans do not compete unfairly because mutual funds and other financial firms have not competed for the small-business market where employees without retirement coverage tend to work. If they had, tens of millions of Americans would not be without coverage, and the state plans probably wouldn’t be needed.
So why do financial firms object? One reason may be that, by law, state plans are transparent about their fees and operations. . .
The funds in question would be kickbacks: corruption and extortion as usual. The regulation made that hard since kickback left a paper trail. Now it’s all better (for Tillerson and those he actually represents). Timothy Cama reports in The Hill:
President Trump signed legislation Tuesday to repeal a controversial regulation that would have required energy companies to disclose their payments to foreign governments.
The legislation is the first time in 16 years that the Congressional Review Act (CRA) has been used to repeal a regulation, and only the second time in the two decades that act has been law. It is the third piece of legislationTrump has signed since taking office three weeks ago.
It is the start of one front in an aggressive deregulatory effort that the Trump administration and the GOP Congress are undertaking to roll back Obama-era rules on fossil fuel companies, financial institutions and other businesses that they say have suffered for the last eight years.
The resolution repeals a Securities and Exchange Commission (SEC) rule written under the 2010 Dodd-Frank financial reform law.
It was meant to fight corruption in resource-rich countries by mandating that companies on United States stock exchanges disclose the royalties and other payments that oil, natural gas, coal and mineral companies make to governments.
At a signing ceremony in the Oval Office, Trump said the legislation is part of a larger regulatory rollback that he and congressional Republicans are undertaking with the goal of economic and job recovery. . .
For all I know, this is a quid pro quo. Certainly it does Russia no harm, either.
Apparently it would be terrible if retirement consultants had to offer advice in the best interests of their clients
Sarah N. Lynch reports for Reuters:
The U.S. Labor Department is preparing to delay its controversial Obama-era fiduciary rule on financial advice for 180 days and seek public comment on the rule.
The agency has sent two separate documents to the Office of Management and Budget for approval, according to sources familiar with the agency’s actions. One document is a proposed rulemaking that simply delays the regulation’s effective date – now April 10 – for 180 days. That proposal has a comment period as short as 15 days.
The second document would start another round of public comment on the rule, which requires brokers and other financial advisers to put their clients’ best interests first when advising them about individual retirement accounts or 401(k) retirement plans.
The Labor Department proposed the rule in September 2010 under President Barack Obama but withdrew the proposal in September 2011 after receiving criticism from the financial services industry. The department re-proposed the rule in April 2015 and made it final on April 6, 2016.
Industry critics claim the rule limits their ability to service clients who cannot afford to pay for financial advice and must use products that carry commissions or other indirect costs.
On Feb. 3, President Donald Trump ordered the Labor Department to review the fiduciary rule – a move widely interpreted as an effort to delay or kill the regulation.
On Wednesday, a U.S. District Court judge upheld the legality of the rule. . .
I just read George Eliot White’s comment in the Washington Post:
It was unfortunate that in Colbert I. King’s Feb. 1 PostPartisan blog excerpt, “Tillerson’s first test” [op-ed], Clark Mollenhoff was identified only as “Nixon’s special counsel and resident gumshoe,” making Mollenhoff sound like some sort of Nixonian goon.
Mollenhoff was a friend when I was a newspaperman covering the White House. Despite taking a year out of his journalistic career to serve as a special counsel to President Richard Nixon, he was a Pulitzer Prize-winning reporter who wrote for the Des Moines Register with few interruptions from 1942 until his death in 1991. Mollenhoff uncovered corruption in the Teamsters union when Dave Beck was its president and did much fine investigative reporting in Washington.
He deserves better.
It awakened memories, and I commented on the story:
I totally agree on Clark Mollenhof’s excellence as a reported. I was in Iowa following close his reporting in the Des Moines Register on the bidding scandal that Fairchild-Hiller surfaced. He was absolutely on top of it and it was thrilling. His reports were better than what could be found in the Washington Post or NY Times.
By chance, some decades later I met socially the man who was General Counsel for Fairchild-Hiller at the time and learned why Mollenhof had such excellent and detailed information. The former general counsel was pleased (and bemused, I think) by how much I knew of the case, until I told him I had read all Mollenhof’s articles on it. “Yes,” he said, “Mollenhof was very good to us.” I then realized the likely source of Mollenhof’s inside knowledge.
It was an interesting case: Fairchild-Hiller got the bid thrown out because the NASA guy in charge had passed along FH proprietary information to General Electric, which then won the bid. (That NASA employ soon left NASA for a highly lucrative position at … wait for it: General Electric!) As this story reports, NASA said it would re-open the bidding. “No, you won’t,” FH said, and forced the contract to be awarded on the original bids, with GE offer removed. And here’s the amazing thing: FH won the contract. (Normally, if a bidder raises a problem about the bidding that forces a re-do, an agency will (grudgingly) redo the bidding but make sure the company raising the problem doesn’t get the contract. It was quite unusual for the company that got the bid revoked was then given the contract.)
Memory lane: nothing like it. But yes, Mollenhof was a dynamite reporter, on that and other stories. I looked for his articles in the Des Moines Register.