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Farmers need financial reform

By Staff | Aug 3, 2012

To the editor,

As Iowa farmers fret over this unprecedented and disastrous drought, it brings home why we need to be able to carefully manage our risks.

While we have been able to survive the financial crisis that crashed our economy in 2008, the recent shocking collapse of Peregrine Financial Group right here in Cedar Falls hits close to home for farmers.

All farmers over the years have tried to hedge crops, thinking it was a good way to protect ourselves. But in the aftermath of MF Global and now Peregrine, farmers know better than to trust their hard-earned money with Wall Street.

It brings home why we need to move forward on implementing the Dodd-Frank Wall Street Reform and Consumer Protection Act, the landmark legislation passed by President Obama.

Wall Street still has not cleaned up its act. Ever since President Obama fought for an overhaul of how we police Wall Street, over the objections of the financial industry, Republicans in Congress and Mitt Romney have talked about repealing Dodd-Frank’s rules for more transparency and oversight of financial markets.

They have also blocked enforcement of the new rules by severely underfunding the Commodities Futures Trading Commission.

The CFTC now has to sort through the wreckage of Peregrine’s bankruptcy to determine how the company was able to deceive its customers and regulators for more than 20 years. Yet this year’s “Ryan budget,” praised and supported by Romney, calls for the CFTC budget to be slashed by $25 million from last year and is $128 million less than the President’s request.

Recklessness on Wall Street nearly destroyed our economy and now has damaged an entire Iowa community.

Mitt Romney has distressingly said he’d rather return to the days when Wall Street wrote its own rules.

Iowans have learned a tough lesson about the perils of that vision.

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