Jeffrey Harris, Dean’s Professor of Finance in the Whitman School of Management , recently reviewed new financial regulatory legislation introduced by U.S. Sen. Richard Shelby (R-AL).
Harris’ comments were included in Shelby’s press release about the Financial Regulatory Responsibility Act of 2011. According to the release, the bill will hold financial regulators accountable for rigorous, consistent economic analysis on every new rule. The legislation would require the identification of the economic impacts of all new rules in addition to improving the transparency and accountability of the regulatory process.
Shelby, the ranking Republican on the Committee on Banking, Housing and Urban Affairs, introduced the bill on Sept. 22. The act is cosponsored by all Republican members of the Banking Committee and is supported by the U.S. Chamber of Commerce.
“The proposed bill encourages rigor and transparency in the economic analysis that is used to support the federal rulemaking process,” Harris, the Commodities Futures and Trading Commission’s former chief economist, said in the release. “Sound economic analysis should always be central to rulemaking and often serves to temper overzealous regulation. Given the recent clamor about the role of economic analysis within various agencies, the bill helps to refocus rulemaking on this central tenet. The recommended Chief Economist Council is particularly innovative, and holds the promise to improve interagency cooperation and to give economists more visibility beyond the walls of an individual agency.”
