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Yaron Brook: GOP Should Repeal Dodd-Frank and Abolish the Fed

House Republicans are doing their best to undo key provisions in the Dodd-Frank financial regulations. A GOP lead subcommittee last week voted to weaken the Consumer Financial Protection Bureau, or CFPB, established to protect consumers from abusive mortgage and credit card policies. Meanwhile, another committee passed a measure to limit funding for the SEC and Commodity Futures Trading Commission (CFTC) to regulate over-the-counter (OTC) derivatives.

Neither measure is expected to pass in the Senate. Though, if it were up to Yaron Brook, president and executive director of the Ayn Rand Institute, he would repeal the entire Dodd-Frank bill. "We need to deregulate," he tells the Daily Ticker's Aaron Task in the accompanying interview. Regulation is at the heart of what's wrong with the economy, he says. "We haven't had real free market capitalism in this country for 100 years. What we're seeing is a constant, steady, consistent erosion in that capitalism."

Too much regulation? Aaron notes in the interview that many have argued the repeal of Glass-Steagall (allowed for investment banks and commercial banks to merge) along with the Commodity Futures Modernization Act of 2000 (which deregulated OTC derivatives) lay at the foundation of the financial crisis. Brook isn't buying it. "In no case did a bank go bankrupt because they were using depositor money to speculate in the market," he says. "This crisis was [caused by] too much debt."

In fact, Brook claims much of the blame for the crisis lies with Fannie Mae and Freddie Mac, two of the most regulated entities in the United States. Instead of protecting the average American, Brook argues, institutions like the Federal Deposit Insurance Corporation and the Federal Reserve that have supported "Too Big to Fail" policies at banks have helped enrich the banking elite to the detriment of taxpayers. "All they do is help redistribute wealth, and ultimately who do they redistribute wealth from? From middle class and low class Americans to CEOs of these banks."

"Let the free market work," he says. Admittedly, the last recession may have been a depression without these institutions, but he's confident that at this point in the recovery, they are also curtailing economic expansion and job growth.

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