Here is a roundup of editorials from last week that show the immense support for Wall Street reform:
USA Today Editorial: Mindless partisanship mars passage of banking reform: “The financial reform measure, though far from perfect, is clearly a step toward making the system safer. It restricts risky trading, requires banks to maintain stronger balance sheets and sets up an orderly process for liquidating those that fail…All in all, however, financial reform is a victory for consumers and economic soundness, even if overheated rhetoric and senseless partisanship nearly kept it from happening.”
New York Times Editorial: Congress Passes Financial Reform: “On Thursday, Senator Mitch McConnell of Kentucky, the Republican leader, lashed out at what he called a “government-driven solution,” while the senior Republican on the banking committee, Richard Shelby of Alabama, bemoaned “vast new bureaucracies.” Those are convenient and time-tested bugaboos to campaign by, but they ignore the urgent needs the bill addresses, and its achievements. Those include resolution procedures to help ensure that shareholders and creditors — not taxpayers — bear the losses when big financial institutions fail; new capital requirements for banks and other curbs to help quell speculative excess, including the regulation of derivatives and restrictions on proprietary trading.”
St. Petersburg Times Editorial: Financial reform is victory for Obama, consumers: “The financial regulatory reforms approved Thursday by the Senate and sent to President Barack Obama will provide important consumer protections and place new restraints on the ability of banks to make the kinds of investments that contributed to the economic meltdown…The bill covers plenty of ground. Companies that own commercial banks no longer will be able to speculate with their own profits, and the banks will be able to invest just 3 percent of their capital in private equity or hedge funds. Credit rating agencies that helped fuel the economic collapse by giving high marks to junk investments could be held liable for investors’ losses if they act recklessly. A new council of regulators will look for threats to the financial system to head off another too-big-to-fail scenario — and the costs of shutting down those that do fail would be paid by the surviving companies instead of taxpayers. A new consumer protection office within the Federal Reserve will oversee such services as mortgages, credit cards and short-term loans.”
Santa Fe New Mexican: Finally, finance reform — or at least a start … “It calls for a council of top officials, headed by the treasury secretary, to look for threats to the financial system — and to take over failing institutions, leaving shareholders to shoulder any losses…It will create a consumer financial protection bureau, one with teeth, to be part of a strengthened Federal Reserve. It imposes new rules and restrictions on mortgage lenders, and it will lead to new pricing for interchange fees charged by debit card issuers…All very distasteful to the Senate Republicans, all but two or three of whom fought reform every step of the way; they’re excoriating it as a “2,300-page legislative monster” that’ll create vast new bureaucracies. Maybe — but opposition senators can thank themselves and three decades of coziness with financiers for the mess they made — and the need to clean it up.”
Providence Journal Editorial: “The measure…will help discourage some of the worst corruption and irresponsibility in the financial sector — though not as much as would a revival of partnerships motivated by fiduciary duty, unlike many publicly held and thus less principled banks, and splitting up “the too-big-to-fail” institutions…Anything that makes the necessary but dangerously too-big sector less of a force in the U.S. economy will be good for most of us. More money, please, for, say, inventors, engineers, physicians, factory workers, entrepreneurs and many others, and a tad less money for people making money by manipulating it.”
Raleigh News & Observer Editorial: “The new Consumer Financial Protection Bureau, a hallmark of President Obama’s financial overhaul proposals that were given final approval yesterday in Congress, is a good stroke for average people. It’s designed to offer protection from predators when it comes to mortgages, credit cards and various big-bank products. The bureau will be a sort of clearinghouse for information and an enforcer of regulations.”