Better Markets, and many other public interest groups, have repeatedly asked the financial regulators to pause their rulemaking process while the American public grapples with the ongoing Coivd-19 outbreak. This week we sent letters directly to the heads of six agencies, the CFTC, SEC, CFPB, FDIC, OCC, and the Federal Reserve Board, asking them to indefinitely extend the public comment periods for their new rule proposals.
The public comment period is the most important step in the rulemaking process. It gives the agencies a chance to receive feedback on their work from outside experts and concerned citizens. This feedback frequently points out mistaken assumptions regulators have made or unintended consequences a rule may have. Mistakes like these are often easy to correct before the rule is finalized but would have massive harmful impacts if left unnoticed.
More importantly, giving the public a proper chance to comment on new rules allows regular citizens, and their representatives, to hold these agencies accountable. If any agency chooses to force through a rule without allowing public feedback they would not only be missing out on valuable feedback, they would be undermining our democratic system.
It is plainly obvious that while the public faces record high unemployment, lockdowns of entire cities, and an unprecedented threat to their health and the health of their loved ones they cannot study and analyze highly technical 300+ page rulemakings.
Some of the agencies are beginning to do the right thing and pause their rulemakings, the SEC announced it would extended the comment deadline for many of its rulemakings and collectively they have extended the deadline for the new “Volker rule” proposal, but it is past time for them to apply this leniency to every single proposal.