May 10, 2012
Good morning. I have two quick points today. First, as we all know, government-wide, there are over 300 rules that are to be promulgated under Dodd-Frank. Most regulators are behind schedule in adopting these rules. Most had a completion date of last July. But for our part, we have been doing our level best to consider all the comments and craft thoughtful rules that make sense for markets, consumers and our economy. I thank the staff, but I particularly want to thank the Chairman for his earnest efforts to keep the trains running on time and getting things done. I don’t know of another agency that has worked so hard and accomplished so much. I heard recently that 67 percent of all the Dodd-Frank rules were NOT finished. At the CFTC, because of the Chairman’s leadership, we have produced well over half of the 50-plus rules that we are charged with completing. This is production number 32.
The cost of not doing these rules is a matter I spent some time discussing yesterday. There was an event in town that focused on cost-benefit analysis (CBA). It is a subject that we all know has been raised in these meetings and I assume the rest of my colleagues have spent time discussing these matters with the myriad folks who visit us.
I spoke to the Chairman about cost/benefit analysis yesterday afternoon and about what might be beneficial to us as we go forward. We would benefit from an expanded component of our cost-benefit analysis. In essence, what makes sense to me is that CBAs be expanded to include not just the quantitative, quantifiable elements of a rule but its qualitative aspects as well. In other words, the social costs and benefits should be taken into account. I by no means want to slow the rulemaking process down. As I said, we are making great progress producing lots of good rules. Nonetheless, I categorically believe some of the most vital cost-benefit effects of rules go past profit and loss statements. We need a wide-screen picture of what—without these rules—the societal cost might be.
Memories fade with time. We need to be mindful of the costs of not doing these things correctly in the context of the colossal calamity of 2008.
Therefore, I thank the Chairman for his leadership and for his responsiveness to an expanded CBA. Let’s keep the hammer down, or as a vegetable farmer once said to me: lettuce produce.
Last Updated: May 10, 2012