Setting the Record Straight on Cost-Benefit Analysis and Financial Reform at the Securities and Exchange Commission
Dennis Kelleher, Better Markets
Simon Johnson, Peterson Institute
Peterson Institute for International Economics, Washington, DC
July 30, 2012
The Peterson Institute hosted a meeting July 30, 2012, to discuss the implementation of the Dodd-Frank financial reform law and to release the new report "Setting the Record Straight on Cost-Benefit Analysis and Financial Reform at the Securities and Exchange Commission" (SEC) by Better Markets, a nonprofit organization that promotes the public interest in the financial markets. An important new development has emerged in the debate over the Dodd-Frank law: an attempt to subject every regulation to extensive cost-benefit analysis with the industry claiming that the costs of financial reform are too high, that they will hurt growth and employment, and that the agencies have failed to conduct proper analysis. These arguments have prevailed in a major court case and have had a significant impact at the regulatory agencies. In response, SEC rulemaking has almost stopped and has revised some of its practices.
Dennis Kelleher, President and CEO of Better Markets, presented his organization's report, which concludes that requiring this analysis would greatly weaken or even kill financial regulatory reform. The report proposes an alternative approach that includes the benefits of reform for society as a whole. Senior Fellow Simon Johnson, who has been actively involved in the financial regulation debate, led off the discussion.
Before creating Better Markets in 2010, Kelleher was chief counsel and senior legislative advisor to the Senate Democratic Policy Committee for four years. He was previously legislative director for Senator Barbara Mikulski, and deputy staff director and general counsel to the Senate Committee on Labor and Human Resources. He was a partner at Skadden, Arps, Slate, Meagher & Flom and received his JD cum laude from Harvard Law School.