As others see it: House votes for needed Wall Street makeover
The U.S. House took important steps Tuesday night by passing legislation to reform Wall Street so as to prevent the same circumstances that set up the Great Recession of the past few years.
Reigning in big banks and their ability to make risky investments will protect the consumer and help prevent another fall. No longer will "too big to fail" drag down the American economy.
A deregulated industry bypassed safeguards in the system -- if there were any -- and eventually faltered, taking with it 8 million jobs and $17 trillion in retirement savings and net worth. The new bill establishes a process to shut down large, failing firms whose collapse would put the entire economy at risk. A bank swirling down the drain, additional costs would be covered by a dissolution fee, paid by an assessment on all large financial firms.
The bill creates a Consumer Financial Protection Bureau to serve as a watchdog to protect Americans from unfair and abusive financial practices. The independent bureau will provide clear and accurate information to consumers and small business to make sure that bank loans, mortgages and credit cards are fair and affordable. ...
"A credit card company shouldn't be allowed to bury unreasonable fees in 30 pages of fine print, or send you a bill the day before it's due so they can collect a late fee," U.S. Rep. Jim Oberstar, DFL-8th District, said in a statement. "This bill puts a cop on the beat to protect working families from unscrupulous finance companies."
The American economy is built on capitalism, but that was during a time when capital meant goods and services. This new economy trades in the intangible -- stocks, derivatives, currency -- all which are ripe for speculation and investment risk.
New rules and regulations need to be framed for this new "capital" economy, just as the federal government regulates food safety and the safety of medicines.
Now it's up to the U.S. Senate to pass its version of Wall Street reform. ....