Banks (including small banks) frequently make errors that they stubbornly resist resolving without a gun to their head. Hence, the regulation that kills many of them.
If they were capable of self-regulating to a reasonable degree, the political pressure to create those regulations never would have existed. If you can't afford to fix your mistakes, you shouldn't be in business in the first place.
That is the fatal flaw in many of these anti-regulation arguments. Self-regulation doesn't exist in capitalism outside of the court system and you can't expect poor people to afford to fight in court every time there is a problem.
That's certainly an interesting take. In all of my dealings with small banks, it was always easy to get an EVP on the phone to sort out problems. That's now virtually impossible dealing with large banks. Frequently I find that even people whose titles indicate they should have power to solve small problems frequently don't. They need to get committee approvals for anything that isn't already governed by their procedure manual. As with any organization, as banks get bigger and bigger, they have less ability to self-regulate and quickly fix mistakes.
BTW, it's not that anyone who has problems with things like the CFPB is necessarily ANTI-REGULATION. It's just hard to grasp how much regulation exists if you're not involved in this industry. And you need to consider the consequences of this kind of regulation. You can't complain that banks are too big to fail if you're simultaneously implementing regulation (even with the best of intentions) that is directly driving banks to get bigger and bigger.
> That's certainly an interesting take. In all of my dealings with small banks, it was always easy to get an EVP on the phone to sort out problems. That's now virtually impossible dealing with large banks. Frequently I find that even people whose titles indicate they should have power to solve small problems frequently don't. They need to get committee approvals for anything that isn't already governed by their procedure manual. As with any organization, as banks get bigger and bigger, they have less ability to self-regulate and quickly fix mistakes.
The EVP (or at least someone with that title) basically told me their records were correct and to pound sand. It was escalated pretty quickly when I made it clear I had a full record of my previous contacts with the bank (including a bank employee agreeing in writing I had cancelled the application) and the dollar amount was large enough I was not going to let it go.
> BTW, it's not that anyone who has problems with things like the CFPB is necessarily ANTI-REGULATION. It's just hard to grasp how much regulation exists if you're not involved in this industry. And you need to consider the consequences of this kind of regulation. You can't complain that banks are too big to fail if you're simultaneously implementing regulation (even with the best of intentions) that is directly driving banks to get bigger and bigger.
Honestly, I'd rather have _well regulated banks_ than no big banks. I don't care if some bank has 15% of the market. I care that there are at least enough competitors (10+) in the market for it to be a competitive market.
But yeah, from my perspective the CFPB is really just a separate arbitration process that keeps people from having to go to court to dispute issues + some post-2008-meltdown regulations. Sure, some problem are excessive but 90% of them likely are not.
If they were capable of self-regulating to a reasonable degree, the political pressure to create those regulations never would have existed. If you can't afford to fix your mistakes, you shouldn't be in business in the first place.
That is the fatal flaw in many of these anti-regulation arguments. Self-regulation doesn't exist in capitalism outside of the court system and you can't expect poor people to afford to fight in court every time there is a problem.