POLITICAL observations & opinions

* for Wall Street reform (Dodd-Frank) to actually happen, President Obama must exercise Presidential leadership

Posted by Lew Weinstein on October 31, 2011

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Josh Boak writes in POLITICO (10/30/11) …

  • President Barack Obama signed the Dodd-Frank financial reform bill into law 15 months ago, saying he was anxious to put new rules of the road in place for Wall Street.
  • But federal agencies have blown about 77 percent of the rule-making deadlines for the massive overhaul, according to a recent progress report by the law firm Davis Polk — meaning key parts of the bill are far from implementation.
  •  “We want quality and speed, but we’re not going to sacrifice quality for speed,” Deputy Treasury Secretary Neal Wolin told POLITICO. “We want to make sure that we do these rules in a thorough way.”
  • “What we’ve seen over the last year,” he said at a news conference this month, “is not only did the financial sector — with the Republican Party in Congress — fight us every inch of the way, but now, you’ve got these same folks suggesting that we should roll back all those reforms and go back to the way it was before the crisis.”
  • But a strategy that largely depends on standing behind a podium and shaming his opponents is unlikely to save the reforms from being killed or delayed, said Arthur Levitt, who was chairman of the Securities and Exchange Commission in the Clinton administration.
  • “A president that wants something as complex as this to take place has to devote an incredible amount of his resources and political capital to getting it done,” he said. “Left to the legislators and regulators, it will sink and rot in the miasma of dialogue and debate.”
  • In putting together the rules, regulators are sorting through thousands of comment letters and answering questions at congressional hearings and meetings with executives and lobbyists from the financial services industry. The sheer volume of activity makes it hard to act quickly or decisively, lending credence to worries that Republicans are obstructing progress.
  • “They hate it; they’re afraid to take it head on, so they’re trying to slow it down in hopes they take over the White House,” said Rep. Barney Frank (D-Mass.), one of the architects of the 2010 law.
  • One financial industry executive said the law touches on so many parts of the economy that both sides have a fair point. Reasons for the delay can range from the intricacies of a regulation to partisan disputes to the roadblocks put up by investment firms to insufficient funding for regulators.
  • Republican lawmakers claim that regulators have not been exhaustive enough in assessing the potential economic impact of the rules.
  • Former SEC Commissioner Paul Atkins said the fundamental problem lies with Dodd-Frank itself, which he said forces regulators to climb “unscalable mountains” and issue rulings that are certain to face challenges in court.
  • The newly created Financial Stability Oversight Council, he said, faces the nearly impossible task of monitoring and quarantining “too big to fail” institutions. Atkins is skeptical that new entities such as the council can provide the kinds of safeguards being promised by the administration.
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LMW COMMENT …

President Obama’s good intentions regarding financial regulation, while a vast improvement over Republican opposition, is not enough. Obama needs to take control of the admittedly complex process, pushing and prodding and making sure the implementation of reforms actually happens. We need to see that he is …
  • (a) committed to the reforms and not beholden to Wall Street and 
  • (b) capable of exercising Presidential leadership.
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One Response to “* for Wall Street reform (Dodd-Frank) to actually happen, President Obama must exercise Presidential leadership”

  1. Mark Lawrence said

    Meanwhile as soon as the speculators back in January 2011 found out no implementation of the law,Gasoline soared to $4.00 a gallon in a matter of 7 days. (from $2.75). And is at $3.93 today. Why?? Was there a shortage?? NO. Was there a disruption??? NO. Its Crooks. We cannot have a “FREE MARKET” with Crooks running it. Remember Al Capone??/ Thats what Wall street and the Commodities markets have become,a bunch of thugs that we continue to bail out. Remember Enron???? Who ever went to jail for that??? Isnt amusing that alot of the Enron crooks went to work for Morgan Stanley to manipulate Oil and Gasoline??? What a mystery that is… The Republicans wanted to make Ken Lay the Energy Sec. Its also no suprise that Eric Cantor and his fellow crook Paul Ryan want to help the crooks succeed. Keep up the nonsense and you will see the 99% take care of this for you Cantor. By the way Cantor you are the real “Mob”. So, I guess we will revisit 2008 all over again thanks to the Wallstreet crooks and I am sure we will bail them out again so that they can pay themselves Multi-million dollar bonuses for Failing…. and with no jobs available, Cantor and Ryan and the Republican Thugs will cut -off unemployment benefits……. Amazing….. and you Republicans think the American public is Stupid???? Think Again. And only Bernie Saunders from Vermont is trying to address this. Both Republicans and Democrats have failed us. No wonder your approval rating is 9% As Donald Trump would say”YOU ARE FIRED”

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