Barney and Ron: Together Again

April 16, 2008

Topic: Government Regulation
Barney and Ron: Together Again

It may come as a shock to supporters of both men, but Barney Frank and Ron Paul are jointly sponsoring s bill affecting federal regulatory power and states’ rights.

by rtbohan
Wednesday, April 16, 2008

The Hill newspaper reports today thatBarney Frank and Ron Paul are together again, or perhaps together again for the first time.( They  jointly introduced a bill in the House of Representatives last Friday dealing with federal regulatory power and states’ rights, issues  on which most would expect them to be taking opposite sides. What may be even more surprising is that the measure is in reponse to complaints from bankes, the Federal Reserve and the Treasury Department.

Barney Frank is a liberal Democrat and an advocate of strong federal regulation of business.  Ron Paul is a conservative Republican and libertarian who wants to limit federal regulation and supports the right of state government to set regulations on matters he believes are outside the legitimate scope of federal power.

What brought the two opponents into at least temporary agreement is their opposition to the 2006 Unlawful Internet Gambling Enforcement Act.  The law the two are sponsoring would prohbit the Federal Government from adopting any measures to carry out this law.

The 2006 Act does not prohibit internet gambling nor regulate it.  It directs the federal government and the banks to enforce various state laws prohibiting gambling.  A number of states, of course, are, directly or indirectly, in the gambling business themselves, either through the licensing and taxing of casinos or through lotteries, which are voluntary tax systems.  These states want to limit competition by banning gambling on the internet and prohbiting payoffs from internet gambling sites.  Unable to directly enforce these laws, they have called upon the federal government to act for them. The NFL and other sports organization as well as the Family Research Council joined in vocal support of the measure.

Representatuve Frank, the Chairman of the House Financial Services Committee, has already sponsored a law to legalize and provide for federal regulation of internet gambling, which would, among other things, repeal the 2006 Act.  It would treat  internet gambling as a matter of interstate commerce and therefore under the delegated power of the federal government.  In terms of economic and personal freedom this might not be an improvement over the current law.

He has joined Representative Paul in sponsoring the legislation introduced Friday in reponse to complaints before his committee from the American Bankers Association, the Federal Reserve and the Treasury Department.  Because a great deal of business is done over the internet and a great deal of money changes hands, the government feels that devising regulations for distinquishing illegal gambling payments from other payments would be difficult to devise.  The bankers feel they would be almost impossible to apply without using too many of the banks’  resources in sorting out the payments.

The Frank-Paul measure would stop the implementation of the 2006 Act by prohibiting the creation of a federal enforcement mechanism  From Frank’s point of view, the measure provides a means of blocking an onerous regulation until his bill can be considered.  From Paul’s point of view, this is another means of limiting federal regulation of business.

This is not the only issue on which Frank and Paul are in agreement, despite their very different viewpoints.  Both, for example, want to leave regulation of at least marijuana, if not other drugs, to the states and get the federal government out. On the whole, however, they have very different views of the role of government and on the interpretation of the constitution.

But intelligent people holding strongly opposing views can work together when their goals coincide.