Is Lunz dishonest, or merely an idiot

Frank Lunz - Why the Dodd Financial Services Bill is bad for ..Democrats

Frank Lunz, in a recent opinion piece/swiftboat, has again shown that facts, logic, and intellectual honesty are not barriers to forming an opinion – at least for the spin doctors in the GOP. Even a quick read of Lunz’ piece shows quarter truths and obfuscation working overtime to make the GOP’s opposition to the Financial Regulation bill look like a win for main street.

Lunz ”But here's where it gets really interesting. The Democrats supporting the current legislation have assured an anxious electorate that whatever funds are used to create whatever regulatory scheme created will come from the banks, not the taxpayers. Let me emphasize that so that even casual readers will catch it: the Democrats promise that you won't pay for their legislation, banks will.

Really?
Since when have corporations ever paid taxes, fees or penalties? Employees end up paying in the form of lower salaries and benefits. Customers end up paying in the form of higher costs.”
So the argument is:
(1) Corporations never pay taxes fees penalties. Well a quick Google shows that SEC fines were among their lowest in 2007 -when the economy started to dissolve – but it also shows $50 million dollar fines to McAfee in 2006, $50 million dollar fine to GE in 2009, $30k fines in April to Stansbury, among many others from a variety of agencies. Since it is a required charge to banks above a certain size to pay into the insurance pool, how are they going to get out of paying this? Of course, there is not an explanation.
(2) Employees end up paying in the form of lower salaries and benefits. Well, I am not sure how much of Main Street is worried about the Salaries of Goldman Sachs, or the executives of JP Morgan/Chase, BOA or Wachovia.
(3) Customers end up paying in the form of higher costs. First, does anyone really have a Goldman checking account or a Bear Stearns ATM card? Of course they don’t, because the product doesn’t exist. Second, this ignores Economics 101. Price is set primarily by what the market will bear, and added costs will reduce profits, but it will not necessarily create new checking taxes. Third, (well or Part two of number two), this big bank fee will actually make smaller banks more competitive. The neighborhood bank will have a lower cost of doing business than the biggest banks, so it could be easier for them to provide cheaper services. Wouldn’t that be good for Main Street!

Lunz “More than 130 companies have publicly hired lobbyists seeking their own loophole. Mars Candy wants to continue to use derivatives to hedge against price hikes in sugar and chocolate, so they've hired a lobbyist. Harley Davidson wants to protect dealer financing of their bikes, so they've hired a lobbyist. And eBay wants to not harm its subsidiary, PayPal, so they've hired ... well ... a team of lobbyists.”

Lenz, not unsurprisingly, fails to mention that farmers have used derivatives as a hedge against price shocks and variable harvests. Does he want to ban them and hurt farmers? Furthermore, he also ignores the fact that the bill does not provide loopholes while banning derivatives.

Lenz closes by blaming Blanche Lincoln’s troubles on the health care bill. This would be perfectly accurate, except she was struggling well before the bill’s passage.

Ah, how easy it would be to make an argument in a world where honesty does not reside.