POLITICS

Dodd-Frank makes some more bureaucrats rich

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Politics,Beltway Confidential,Timothy P. Carney

When government sticks its hands further into the economy, it makes more opportunities for government officials to monetize their public service by cashing out and working for the businesses being regulated and subsidized.

This week, two longtime SEC officials, James Brigagliano and John Walsh, left for lobbying and law firm Sidley Austin on K Street. Bloomberg has the money quotes:

“As the line between compliance and enforcement increasingly blurs, I look forward to using my extensive knowledge to help counsel clients on some of their most critical matters and help them navigate today’s new regulatory and compliance hurdles,” Walsh said in a statement. He helped create the SEC compliance and inspections unit, which oversees broker-dealers, and served as acting director in 2009....

“I look forward to assisting clients in navigating the ever-changing regulatory landscape and joining former colleagues from the SEC,” Brigagliano said in a statement.

You see the incentives, then, for politicians and bureaucrats. More government equals more demand for former government officials. This doesn't quite jibe with the common liberal and mainstream media notion that big business and laissez-faire attitudes go hand-in-hand.

This fits into the pattern of Dodd-Frank: Regulate them, then work for them. It also mirrors the Great Health Care Cashout, where Obamacare authors go to work for health-care companies.

And don't think the folks hiring these revolvers are just playing defense. There will also be business pressure for regulations that help keep out new competition and boost investor confidence.

A final point: Sometimes businesses lobby for Big Government while it's not optimal for them. One reason: their lobbyists are former bureaucrats who instinctively favor more government.

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