Vitter opposes 'too big to fail'
by jordan blum
Advocate Washington bureau
June 08, 2013
Sen. David Vitter, R-La., wrote a letter Friday to U.S. Treasury Secretary Timothy Geithner asking him to cancel any potential plans to designate certain nonbanking institutions what Vitter calls “too big to fail.”
Vitter said he is concerned that the 2010 Dodd-Frank Act in the aftermath of the Wall Street crisis that designated some so-called megabanks as “systemically important financial institutions” — or “too big to fail” — could lead to such designations expanding beyond the banking industry and create unfair advantages for some businesses.
While the federal government has maintained that such a large spread into nonbanking institutions will not occur, Vitter argued that vague language and a lack of enough Federal Reserve Board rules on the matter could open the door for such an expansion.
“These hasty, unfair and potentially unnecessary designations will spread the too-big-to-fail epidemic from our banking system into other sectors of the economy,” Vitter said in the announcement.
“Secretary Geithner and the Financial Stability Oversight Council created by Dodd-Frank need to slow down their regulatory regime’s efforts to designate nonbanks as systemically important until all of the rules for the designation process are clarified and finalized, and ensure that taxpayers aren’t going to be on the hook to bail out these companies down the road.”
Vitter has sought to further regulate the growth of the nation’s largest banks by forcing them to have larger safety nets in order to keep them from becoming “too big to fail.”
Federal grants for Southern
Vitter and Sen. Mary Landrieu, D-La., announced more than $4 million in hurricane recovery grants authorized ranging from projects for Southern University to the New Orleans BioInnovation Center.
Southern is getting $1 million to jumpstart a new Center for Business Opportunities and Disaster Recovery that will essentially serve as a small business incubator on campus.
“The center will allow the university the opportunity to minimize economic dislocations resulting from a major disaster by promoting job creation, supporting economic diversification for small business owners, help entrepreneurs to follow their dreams and make a positive impact on the community,” Vice President for Advancement Ernie Hughes said.
The New Orleans BioInnovation Center is receiving $360,000 to invest in industries that rebuild wetlands, implement water management strategies, promote clean technologies, and perform other risk mitigation activities in southeastern Louisiana.
The largest chunk is $1.8 million going to the St. Mary Parish Levee District and the Terrebonne Parish Levee and Conservation District to help improve flood control in south central Louisiana and help expand business in industries such as shipbuilding, seafood, oil and gas.
Lastly, $1 million is going to the Baton Rouge Port Commission for a rail-line improvement near Port Allen.
EPA administrator to visit N.O.
Environmental Protection Agency Administrator Lisa Jackson is in New Orleans on Monday to deliver the keynote address at the Water Environment Federation’s annual Technical Exhibition and Conference, which is the largest annual water quality conference in the world.
Jackson is expected to discuss the efforts made in ensuring the availability of clean water and in creating emerging opportunities for innovation in water infrastructure. This year is the 40th anniversary of the Clean Water Act.
Jackson also will join with U.S. Department of Commerce Under Secretary for International Trade Francisco Sánchez to officially launch the U.S. Environmental Technologies Export Initiative. This new initiative is designed to foster greater interagency collaboration in U.S. government trade, technology exports and international environmental activities.
The initiative launch is scheduled for 9:45 a.m. at the conference at the Ernest N. Morial Convention Center. The keynote address is slated for 10:30 a.m.
BP briefing scheduled
The Senate Environment and Public Works Committee is hosting an official briefing on Tuesday in New Orleans regarding the ongoing clean-up efforts from the 2010 BP oil leak.
The committee, on which Vitter is a member, is expected to take testimony from officials with the U.S. Coast Guard, the Louisiana Coastal Protection and Restoration Authority and other officials from the area. BP officials have also been invited but have not been confirmed.
“This is some of the most significant environmental work of our lifetime,” Vitter said in the announcement. “We need to prevent BP from walking away from the clean-up before it’s complete and to ensure that Louisiana’s coastal restoration efforts are successful.”
U.S. Rep. Bill Cassidy, R-Baton Rouge, and other elected officials are expected to participate.
The event is slated for 10 a.m. Tuesday in the Louisiana Supreme Court’s fourth floor courtroom.
Jordan Blum is chief of The Advocate Washington bureau. His email address is jblum@theadvocate.