THE WALL STREET REFORM AND CONSUMER PROTECTION ACT…. Yesterday’s big news on the Hill was the House vote on bringing new safeguards and regulations to how Wall Street does business.
The House approved a Democratic plan on Friday to tighten federal regulation of Wall Street and banks, advancing a far-reaching Congressional response to the financial crisis that rocked the economy.
After three days of floor debate, the House voted 223 to 202 to approve the measure. It would create an agency to protect consumers from abusive lending practices, set rules for the trading of some of the sophisticated financial instruments that fueled the crisis, and take steps to reduce the threat that the failure of one or two huge banks or investment firms could topple the entire economy. […]
The Democratic authors of the House legislation hailed the bill as the biggest change in oversight of Wall Street since the Great Depression, and said they believed they had struck a careful balance between protecting the public and the economy while not stifling economic growth and market forces…. The bill represents an attempt to address comprehensively what many of its supporters have called the underlying causes of the collapse — reckless risk-taking unrestrained by regulation.
There is, of course, a chasm between the status quo and the ideal. Democrats claim that the reforms are the most significant since the New Deal. A wide variety of progressive analysts believe the reforms fall far short of what’s needed. Who’s right? Well, both are.
For all the key improvements, the House bill lacks, for example, a cramdown provision, which Blue Dog Democrats joined Republicans in killing, and which would have likely made a major difference in the lives of many. For that matter, institutions that are “too big to fail” are still “too big to fail.”
But it’s worth noting that just one year after Wall Street recklessness pushed the global economy to the brink of wholesale collapse, exactly zero House Republicans voted for watered-down safeguards, deeming them too onerous. Indeed, their unanimous opposition to Wall Street accountability came just a few days after the House Republican leadership huddled with more than 100 lobbyists to rally opposition to preventing Wall Street irresponsibility.
Shortly after the vote, DNC Communications Director Brad Woodhouse issued a statement. The subject line of the email read, “Seriously?”
“Not one Republican voted for the financial regulatory reform and consumer protection bill in the House. Not one,” Woodhouse said. “One year after nearly the worst financial collapse in our nation’s history — a collapse brought on by the excessive greed and risk taking of Wall Street and by the anything goes regulatory environment put in place by Republicans — not one Republican in the House thinks that consumers deserve additional protections or that the practices of Wall Street should be curbed. Do the Republicans not get that one of the reasons they lost so badly in 2006 and 2008 is because the public believed that the GOP had just become shills for oil companies, Wall Street financiers and insurance companies? Apparently not — because here they go again.”
The goal, apparently, is for Republicans to actually suffer some electoral consequences for this one. DCCC Chairman Chris Van Hollen (D-Md.) told reporters that GOP opponents of reforming the way Wall Street does business “are going to pay a very heavy price.”
And in his weekly White House address this morning, President Obama reminded Americans, “Just last week, Republican leaders in the House summoned more than 100 key lobbyists for the financial industry to a ‘pep rally’, and urged them to redouble their efforts to block meaningful financial reform.”
Is this the issue on which Democrats take the offensive?