‘Wall Street’ ‘Reform’ ‘Compromise’ Reached

Daniel Foster
National Review
6/25/2010

After a 20-hour all-nighter, the House/Senate conference committee struck an early morning deal on financial reform, setting up a final vote next week.

Why all the inverted commas? Well, there is much in the bill that has nothing to do with ‘Wall Street’ or the root causes of the crisis (i.e. debit card and interchange fee rules); there is little in it that will ‘reform’ too big to fail or change the incentives for the kind of behavior that led to the crisis (implicit subsidies and bailout authority galore); and it was a ‘compromise’ mostly between Democrats.

From WaPo:

A new consumer protection bureau housed in the Federal Reserve would have independent funding, an independent leader and near-total autonomy to write and enforce rules. The government would have broad new powers to seize and wind down large, failing financial firms and to oversee the $600-trillion derivatives market. In addition, a council of regulators, headed by the Treasury secretary, would monitor the financial landscape for potential systemic risks…

Why didn’t Republicans support the measure? Sen. Judd Gregg (R., N.H.) sums it up:

“This legislation is a failure on both counts,” Sen. Judd Gregg (R-NH) said in a statement that denounced the compromise as failing to address “shoddy underwriting practices” or problems with the government-sponsored entities Fannie Mae and Freddie Mac. “It will not encourage much-needed stability and confidence in our financial markets. It will not significantly reduce systemic risk in our financial sector.”

…More on the bill as it becomes clearer, to be sure. But a parting thought from outgoing Sen. Chris Dodd (D., Conn.), a sequel to Nancy Pelosi’s “pass the bill to find out what’s in it.”

“It’s a great moment. I’m proud to have been here,” said a teary-eyed Sen. Christopher J. Dodd (D-Conn.), who as chairman of the Senate Banking Committee led the effort in the Senate. “No one will know until this is actually in place how it works. But we believe we’ve done something that has been needed for a long time. It took a crisis to bring us to the point where we could actually get this job done.”…

'FrankenDodd' (H/T Glenn Beck)

Read the entire article at National Review.

The Washington Post article concludes:

“…One of the last motions Friday was to name the bill after the two chairmen, Dodd and Rep. Barney Frank (D-Mass.), who had shepherded the legislation through the House over the past year. At 5:07 a.m., they agreed unanimously that it would be known as the Dodd-Frank bill, and the sound of applause echoed down the empty hallways.”

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