
Many who crafted regulations after the 2008 crisis now work for Wall Street - Dowwie
https://www.washingtonpost.com/business/economy/many-lawmakers-and-aids-who-crafted-financial-regulations-after-the-2008-crisis-now-work-for-wall-street/2018/09/07/50f63a1e-b075-11e8-a20b-5f4f84429666_story.html
======
chollida1
I mean the man who wrote the CBA for the NHL owners now works for the Toronto
Maple Leafs.

If you were regulated and you had to hire someone to help you understand what
you are and aren't allowed to do by these regulations wouldn't the first
person you look to hire be the person who actually wrote the rules?

> Seventeen of the 40 most senior staffers who served on the House Financial
> Services Committee in August 2008, as well as 15 of the 40 senior staff who
> served on the Senate Banking Committee at that time, later joined or took
> jobs representing a large financial institution.

So you train for many years and acquire knowledge of a particular area and
then what? You can't actually make money from the skill you learned?

People get angry when tech companies try to limit people mobility, you really
have to work hard to contort your view to see this as being any different.

Most governments actually spend alot of money on programs to get people from
private industry to do a year stint with the government and then go back to
private industry. They do this because everyone sees value in people moving
from government to private industry.

If you are against this what measure would you consider to be fair that
doesn't limit a person's mobility, wrt work, and helps get people who worked
in government into private industry.

~~~
x2398dh1
So your argument is, "Self-interested entity A wants to gain something,
therefore they should take it."

There is absolutely zero substance to what you are saying. You are basically
saying, "the strong survive! Yay on strong! Boo on weak!"

That is the basis of what you are saying. Then you back it up by saying, "This
is the way it has always been done! Timmy jumped off a bridge too, so I should
do it!" Did you know that it is completely possible that other Governments are
doing things wrong as well?

~~~
chollida1
There are alot of quotes in your comment, none of them came from anything I
said in my original comment.

I love good discussion, I find nothing helps form and destroy opinions better.

If you'd like to have one I'll participate.

~~~
jessaustin
Haha if you really loved discussion one would wonder why you chose this
particular comment as the only one of a dozen mostly more substantive comments
to which you would respond after three hours...

------
mr_tristan
We have a system that lets legislators manufacture a job specialty for
themselves. Out of basically nothing but reactions to serious problems of the
past.

While it may generally be done in good faith, it still doesn't seem to avoid a
tragedy of the commons. We now are building a system so byzantine that nobody
wants to operate without a part of their business working to understand public
policy.

Complexity seems to beget more complexity. While this sort of thing may have
"always been done", I sometimes fear that with more tools like machine
learning, AI, etc, we are going to just simply compound the rate of complexity
growth. And thus we end up with specializations that were completely
manufactured. It just seems wasteful.

~~~
nraynaud
> Complexity seems to beget more complexity.

it's funny, I see it a lot in software too, people who "write a script to
manage/hide/tame complexity". Cool, a new layer to go through when something
doesn't work well.

On the general issue, it's pervasive at private companies too, where an
important problem leads hiring ("this new person will be responsible that it
doesn't happen again") and procedures centered around it whatever the cost.
Then those companies round up and create a standard around it, and compliance
jobs, etc.

------
smsm42
How else could it be? To craft regulations in the field X, you need experience
in the field X. That means, you must have worked in the field X, and probably
doing something worth mentioning, otherwise what kind of experience would it
be? Then, after you are done crafting regulations, what else you would be
doing? I mean, you could just drop everything you know and start a new career,
but it'd be weird to expect that happen in a majority of cases. I am actually
surprised that's only 30/40 percent (maybe some of the staff weren't actually
domain specialists but did something else). Most of the time, you could stay
in the government for a while, but then you'd might move on to work in the
field X again (might not, but everybody can't work work the government - I
hope not). So the article sounds like "people with law degrees work as
attorneys!" \- yeah, thanks, Captain Obvious, you never disappoint.

Now, I can see what people can be worried about - that the insiders of the
industry would craft regulations in self-serving ways (also known as
regulatory capture). The thing is, this is something that follows from the
very nature of the thing - unless you want a highly technical field to be
regulated by people who have no idea what's going on (not that it could happen
in our politics, oh no sir, never!) you have to solicit help from the insiders
and rely on their opinions. And then those insiders wouldn't just retire
happily, having served their country, they'd continue being insiders with
their own self-interest. We should stop being surprised about it.

------
kartan
> The financial industry showed its might in other debates, as well. In one
> example, Republicans in the Senate joined with moderate Democrats in 2009 to
> defeat a plan to allow judges to set new terms of mortgages, a measure that
> could have also allowed Americans to get more favorable terms amid the
> housing crisis.

This is a very important point. Wall Street is getting power and knowledge
directly from the source. Who is defending Main Street needs?

> But the effect of the banks’ influence, according to former lawmakers, was
> to dilute the legislation.

This is one of the reasons we get so bad legislation. The original ideas and
goals were good. But they get lobbied out of existence.

So, I do not know if working for the Wall Street is a bad thing per se to do
for legislators once they finish their terms. But the result is an unhealthy
economy. And that needs to be addressed.

------
geggam
And this surprises who ?

~~~
pizzazzaro
Apparently the Libertarians that think such a revolving door is a "good thing
for people's careers", but forget about why those regulations exist in the
first place.

------
gammateam
and I aspire to do the same thing?

any 4 year old can see this is an effective way of navigating life and
securing access to goods and resources for generations, why do the rest of you
guys spend decades acting like this is novel?

this is how the whole world has functioned for millenia, you are WAY ahead of
yourself if your motive for saying "AHA!" every time you see this is because
its not the most ideal way to run an egalitarian society. The biggest
newsflash should be that you were sold a false premise of how representation
works in this country and the level of influence you get to have

everyone that matters for the machinations of the world kind of already gets
it?

------
DoctorOetker
If the financial laws were designed to be machine readable, there would be no
need to hire ex-regulators. The refusal to start formalizing law to a machine
readable form indicates either incompetence or malice.

~~~
lolsal
You don't think it's possible that 'financial laws' are just a little bit more
complicated and complex such that there are more than two possible reasons
they are not machine-readable? Lots of laws are up to interpretation which is
why we have judges.

~~~
DoctorOetker
Who cares if its complicated and complex?

>Lots of laws are up to interpretation which is why we have judges.

What you describe is retroactivity: i.e. in some systems (like Anglosaxon
Common Law)- more than in others (like European Civil Law) there is some
retroactive _legislative_ power granted to judges, who normally only apply the
law and not write or clarify it.

This is orthogonal to formalization. I wish to illustrate this by example, but
I want to keep my comment as orthogonal as possible to other opinions, since I
am not trying to force civil law views on people who prefer common law and
vice versa I will describe _possible_ ways of formalizing the comment you made
for 3 systems: civil law, common law and direct democracy. It's just an idea,
fit or don't fit it in your own ideology as you like.

General definitions:

\- Green zone: actions which are explicitly permitted with _ultimately very
low_ probability of retroactive punishment or fine for a perpetrator.

\- Red zone: actions which are explicitly forbidden with _ultimately very low_
probability of retroactive non-enforcement of compensation to a victim of the
action.

\- Grey zone: actions which are explicitly _guaranteed_ to be retroactively
decided upon by the appropriate authority: in the Common Law: either
legislative branch or a judge; in a pure Civil Law: the legislative branch; in
a direct democracy: a vote or referendum by the people at large, aka trial by
democracy (frowned upon, just like stepping in the grey zone).

\- All cases are decided by a formal verifier, the victim (a company, the
state, an individual, ...) presents the formal proof of the defendant's crime
in the red zone. Normally the Defendant is unable to formally prove he is in
the green zone (an inconsistency in the law). If he _is_ able to present such
a proof then the case is decided (and the law is either reformed to resolve
this specific inconsistency or kept gray) by forwarding the case to the
authority as described in the Grey zone definition. Virtually never should an
inconsistency be found.

\- If an entity is found to have acted provably in the grey zone, anyone can
make claims, and they are again brought to the appropriate legislative
authority (parliament, judge or public depending on your system of choice)

\- A budget of say $1M per day for the US (which comes down to less than $2
per capita per year) goes _continuously_ into a growing pot, and anyone is
free to explore the machine readable law and construct hypothetical
inconsistent situations. If you can find a hypothetical inconsistent situation
before it actually occurs to people you spare people misery. The inconsistency
that hopefully didn't occur yet is presented to the legislative authority,
again parliament/judge/populace. At any rate, the rate at which
inconsistencies are discovered tells us something about the quality of laws
written, and which laws needs more attention than others. The reward is half
the reward pot content, so if one a day is found its $1M, if 10 a day are
found $100k if one every 10 days its $10M... This is what I meant with
_ultimately very low_ probability of retroactive decisions.

\- Risk averse entities will stay in the green zone, audacious ones embrace
the whims of the legislative branch, which is hopefully more expensive to
bribe (with money or jobs) than a regulatory agency: this may be true for a
parliament but perhaps less true for a single judge. Bribing the populace as a
whole seems uneconomical and ... transparent.

\- Since each sector has competition, and some actors will remain more in the
green zone and other will sometimes risk the grey zone, whenever a gray zone
event is tolerated, the green zone companies will complain because their
competition got ahead with a gamble, and they will require less and/or smaller
grey zones, while the company that was in the gray zone will demand bigger and
more grey zones to scare away those that prefer the concept of finality. So
basically each sector sees both forces that vote for finality and also forces
that vote for retroactivity. Most will probably demand finality. Now grey
zones can expand and contract, if 1) they keep expanding indefinitely at some
point there is no law and we are judged entirely ad hoc by
parliament/judges/populace, or 2) they settle on a specific extent and staying
in the green or going in the grey is a personal choice or 3) society (industry
and or population) starts demanding laws without or at least with smaller and
smaller grey zones, and the process is encouraging formalization of all law.

So retroactivity can be formalized without neccessarily devolving in ad hoc
decision making.

It's the same confusion as between determinism and formalization: an
indeterministic finite state machine can still be formalized.

So yes I still think its incompetence or malice. (today you can't even prove
that you are in a green or red zone, in the system I just described you can at
least verify such proofs if you can generate them)

------
krupan
If this kind of thing bothers you, please help make Bitcoin successful.

------
DanCarvajal
Also the sky is blue.

