- According to the Washington Post, the Small Business Administration has been falsely qualifying large companies and their subsidiaries as small businesses, allowing them to get billions in government contracts that should have gone to small companies. Unfortunately, the Post paints this as a revelation, when in fact the small-business community has complained about it for years. Though the article quotes Lloyd Chapman, head of the American Small Business League, it fails to note any of the yeoman’s work his group has been doing on this issue. If John McCain really cared about small businesses, he’d be spending a lot more time listening to Chapman.
Rothkopf raises an
interesting point in this morning’s Financial Times: “As this crisis has unfolded, the first
impulse of some of the countries in trouble has been to seek aid from
emerging economy lenders, from countries that possess both the financial
resources to help and a more accommodating attitude to lending conditions.”
But Rothkopf draws the wrong conclusion. His two examples are Iceland, which went to Russia, and Pakistan,
which went to China.
But both countries ultimately turned to the IMF for help. Why? Too much
parsimony on the part of lenders whose primary interest is
self-advancement, not international stability. True, Venezuela has gotten loans from Russia, and parts of Africa have benefited
But decisions made by Hugo Chavez hardly prove a trend, and China’s role in Africa
is old news. Nevertheless, like so many Washington geopoliticians these days, Rothkopf
has caught a whiff of what he thinks is a trend and throws in the
multilateral towel: “The old system is outdated. The powers that dominated
it did not practise the medicine they preached to others in previous
financial crises. Any new system must now reflect the new financial order,
giving bigger roles to emerging powers.” There’s no denying that China is a
force to be reckoned with. But the choice isn’t between our way and their way:
Having proven that liberal, capitalist internationalism works, the real
challenge is to integrate China
and others into that structure.
- It’s a shame that Arthur Levitt has already been SEC chair, because assuming Obama wins next month, he could sure use him. Levitt has another great piece in the Wall Street Journal today, proposing an agency that would combine the SEC and the Commodity Futures Trading Commission. As Levitt argues, there’s no good reason why we have one agency regulating public companies and the stock market and one regulating futures markets. But the critical point is his call for the chair to be appointed to a seven-year post, as at the Fed. Doing so would greatly reduce the sort of political pressures that forced out William Donaldson and give the chair sufficient time to push through a substantial reform agenda.
- According to Bloomberg, “Merrill Lynch & Co., UBS AG and JPMorgan & Chase Co. are telling senior bankers in Asia to fly coach on short-haul flights and reduce non-essential travel as they step up cost cuts.”(HT to Dealbreaker.) I understand why the big banks want to make it look like they’re doing their share of sail-trimming, but how much money is this really going to save? It reminds me of the time I was working at a struggling dot-com in New York, way way back when. To save money the CEO asked us to do a better job of turning out the lights in the bathroom. That’s when I started looking for a new job.