According to the Tax Prof Blog, President Obama signed H.R. 1586 into law yesterday. The legislation creates a “$10 billion fund to prevent teacher layoffs and provide a temporary increase in the Federal Medical Assistance Percentage, funded with corporate international tax changes.”
You can find more information on the new law through the official links below:
White House.gov: Another Step Towards Sustainable Recovery
As was expected, President Obama signed the new financial reform bill into law earlier today. The bill, which was over a year in the making, will be used to regulate financial institutions and protect the U.S. consumers and taxpayers.
"These reforms represent the strongest consumer financial protections in history," President Obama said. "And these protections will be enforced by a new consumer watchdog with just one job: looking out for people - not big banks, not lenders, not investment houses - in the financial system."
In a major signing ceremony at the Ronald Reagan Building in Washington, President Obama was flanked by a number of lawmakers who worked on the legislation, including Sen. Christopher Dodd, D-Conn., and Rep. Barney Frank, D-Mass., the two committee chairmen who sponsored the bill.
The new law attempts to shine a light on complex financial products called derivatives and immediately gives regulators stronger powers to break up financial companies that have grown too big.
Among its many provisions, the law also creates a new consumer protection agency which would set rules to curb unfair practices in consumer loans and credit cards.
As we all know, lawmakers do not always get it right when they draft and support new financial laws. However, as this Forbes.com article shows, some times the bills they pass are so ridiculous that it is surprising they ever become law. In a new “Gallery of Pain,” Forbes.com has collected a slideshow of the dumbest financial laws of all time. You can find the text regarding some of the laws included in their list below, but be sure to view the slideshow at Forbes.com.
How worried should the world be about the new regulatory reform bill wending its way through the U.S. Congress? Given the country's track record on looking after the financial services industry, the answer is: plenty worried.
Even the staunchest believers in free enterprise would agree that a modicum of regulation is necessary for a functioning economy. The new bill, which Congress aims to get on President Obama's desk before the July recess, looks to be chock full of ways to ward off yet another financial crisis. These include: audits of the Federal Reserve; the dismantling of lucrative banking divisions devoted to crafting and trading complex securities called derivatives; an agency that would take quick control of troubled financial institutions; and the so-called Volcker rule, after former Federal Reserve chairman Paul Volcker, that would prohibit banks from making speculative trades with depositors' money.
Whatever ideas end up on the books, three things are certain.
First, regulation--no matter how well intended--comes with a whole heap of unintended consequences. Some laws have invited, or at least exacerbated, full-blown financial crises. (For a round-up of the most ill-fated legislation, see our slide show.) "Regulations are fixed in time and can't adapt," says David Weiman, a professor of economics history at Barnard College.
There has been a lot of media attention placed on the effects of Arizona’s new immigration law and the impact on local residents. However, the bill also includes strict new immigration requirements for business owners. As this article from Forbes.com explains, the law is likely to make doing business in Arizona much more difficult.
SB 1070 is the most extreme anti-business law in recent history. For instance, sections 7 and 8 set out punishments for employers who knowingly or intentionally hire undocumented workers. In both cases for a first offense, the employer has to fire all undocumented workers, sign an affidavit attesting to that and promising not to repeat his mistake, and have all his business licenses suspended.
Additionally, and perhaps most gallingly, the business is then put on a three-year probation (five years for those that intentionally hire undocumented workers) and must file quarterly records to prove that it has not since broken the law again. This would amount to businesses being presumed guilty and being forced to prove their innocence. It will hurt entrepreneurship and endanger the economic recovery.
Most egregiously, if a business commits a second such offense and hires an undocumented worker, all of its business licenses are permanently revoked. Because it is illegal to operate a business without a state-sanctioned license in the state of Arizona, that amounts to the government forcibly shutting down someone's business.
After weeks of renovation and a long approval process, Obama is now making his way to Denver, to sign his Stimulus Bill into law at a science museum. NECN.com posted a video and article discussing the plan and how it went. A portion of the article can be found below, but the video and full post can be viewed here.
As President Obama boarded Air Force One this morning for Denver, he left behind Washington D.C., where the stimulus bill faced nearly unanimous Republican opposition.
Instead, he'll sign the bill at a science museum, and focus on investment in green jobs and technology like wind and solar power.
It's a massive bill combining spending and tax breaks -- $787 billion dollars in all.
Some of the first money, $27 billion, will go to states for projects like road and bridge repair.
The bill also includes a $400 tax credit and incentives to buy first homes and new cars.
There's $100 billion in new spending for schools and colleges.
Unemployment and food benefits will be extended, a bit of help for these auto industry employees, who learned just yesterday, they're losing their jobs.
But will it work, and how fast? So far, stocks have tumbled as Wall Street investors worry it may be some time before the stimulus money helps turn the economy around.
GM and Chrysler, which have already received billions in federal loans, must submit plans to the government for staying viable by the end of the business day.
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