AFR Analysis of the GOP Alternative to S. 3217
To: Interested Parties
From: Americans for Financial Reform
Re: GOP Alternative to S. 3217
Date: April 28, 2010
For nearly a year, both parties in Congress have been debating the direction of financial reform. Ever since the bill moved to the final stages of Senate deliberations, however, opponents of reform have had a hard time choosing a line of attack. Is it too tough on banks and Wall Street (“stifling innovation”), or not tough enough (“a bailout bill”)? We finally have an answer. Yesterday, the united Republican opposition delivered a summary of their alternative.
The Republican financial reform summary exposes that the bill’s opponents are not actually as concerned with the resolution authority mechanisms in the bill—their “bailout” canard—as they are with weakening tough bank regulations and stripping investor and consumer protections from the Dodd bill. The architecture of the Dodd bill is followed but essential parts are watered-down in an attempt to maintain the status quo, which will benefit bankers on Wall Street at the expense of consumers and small businesses on Main Street.
The Republican summary follows the lead of the Dodd bill in creating an early warning system, a resolution mechanism, a consumer protection agency, enhanced investor protections, and derivatives regulations. While there may be broad agreement in principle, the teeth of the Dodd bill are necessary to hold big banks accountable, protect consumers and put the regulations in place to prevent the Wall Street abuses that led to the economic crisis.Congress