It has ceased to surprise me when this President goes directly to those that one would expect would not be so happy to see him and speak to them about what he sees as their responsibility in helping the rest of us keep this nation strong. The president spoke to students, professors and Wall Street Titans at Cooper Union College in Manhattan, New York about the up-coming financial regulations. He was there to ask for their help in getting this regulation passed as well as to dispel some of the lies about what the legislation would do.
The president’s message was mixed with straight talk about what part some of those on Wall Street played in the near collapse of our economy and a polite request and reasons why it would benefit all concerned. I would say that it had a very positive effect based on the results from the market after he spoke. I think it showed that there really are more people on Wall Street wishing to do the right thing than those only looking to make a quick buck. Despite only hearing about those who get caught from our information stations. I even heard one trader who worked on Wall Street that said he and a few of his fellow traders were pleased by what the President had to say and was glad to see Washington kicking into action.
After 50 hours of debate the US House of Representatives passed HR4173 the Wall Street reform and Consumer Protection Act. This act “addresses a myriad of causes from predatory lending to unregulated derivatives and includes the following major provisions” (www.financialservices.house.gov). Consumer Protection, Financial Stability Council, Dissolution Authority and Ending “Too Big to Fail”, Executive Compensation, Investor Protection, Regulation of Derivatives, Mortgage reform and Anti-Predatory Lending, Reform of Credit Rating Agencies, Hedge Fund Private Equity and Private Pools of Capital Registration and Creation of an Office of insurance. The reforms are quite similar if not exactly like those being debated in the Senate with a few differences. The senate version seeks to create a Single Federal Bank Regulator and “strengthens oversight and empowers regulators to aggressively pursue financial fraud, conflicts of interest and manipulation of the system” (www.banking.senate.gov). The Senate version also includes closing the loophole in regulation which includes payday lenders as well. While the House version does not mention payday lenders, it does mention an agency which gets little coverage but has a great deal to do with the availability of credit for many Americans and small businesses and that is the credit rating agencies.
Out of the two versions, the one that I would have to support more than the other is the House version. I believe that it has more bite than just bark and it covers agencies that are not associated with this mess even though they had a hand in it just as the banks did. To make the final bill one that I think would “restore responsibility and accountability in our financial system to give Americans confidence that there is a system in place that works for and protects them” (www.banking.senate.gov) would be if, in conference, the senate adopted the house version but added their payday lender part. I know that there are those who will say that either of these bills do not go far enough but we all must crawl before we can walk and having this as a foundation will allow us to continue building this structure until we finally have the type of system needed in this new era of Corporate America and for the protection of our citizens. It’s more than the only thing to do; it’s the right thing to do.