SALON

Sunday, Nov 18, 2012 3:00 PM UTC

Obama’s blueprint for strengthening financial reform

Dodd-Frank was a nice step, but the president needs to give regulators the resources to do their jobs. Here's how

By

Topics: Dodd-Frank Bill, Next New Deal, Financial Reform, Wall Street, Business, Barack Obama, ,

Obama's blueprint for strengthening financial reform (Credit: AP/Carolyn Kaster)
This originally appeared on Next New Deal.

Next New Deal One of the Obama administration’s biggest vulnerabilities when it comes to its first term policy legacy was that the roots of the legislation it ushered through wouldn’t take hold until around 2014. Thus if a Republican president took office in 2013, there was a real chance that he could dismantle, or at least strongly interfere with, the new framework for health care and financial regulations. And it was clear by 2010 that movement conservatives would make the repeal or collapse of both bills a litmus test for all Republicans in office.

But with President Obama’s victory last week, the core framework of Dodd-Frank, the financial reform bill he signed in 2010, will become the law of the land. The question now is how to best push it forward in the coming months and years.

The most sensible, immediate reform would be to give regulators the adequate resources necessary to do their jobs. The CFTC had its funding cut by both parties last year in a move that will make their crucial work even harder to accomplish. The GOP is aiming to remove the independent funding stream for the CFPB. Without decent resources, it is unlikely that financial reform will be carried out effectively.

The next goal will require new reforms to draw some lines on the issues that haven’t been implemented well after the initial passage of the law. The Volcker Rule continues to be a mess while rules are being written. There isn’t a clear vision for what important new offices like the Office for Financial Research will set out to accomplish. These are major pieces of the legislation and are essential to creating fair, accountable, and transparent markets.

Fleshing out the post-Dodd-Frank agenda is also crucial. What should the proper regulations, if any, of high-frequency trading look like? Is breaking up the banks necessary for eliminating Too Big To Fail and the power of the financial firms over the markets, as a larger chorus of experts is starting to argue? How important is the government in preserving middle-class access to a 30-year fixed interest rate mortgage loan?

Fighting off a bi-partisan effort to make Dodd-Frank more industry-friendly will continue to be a full-time battle. But even though we don’t have to worry about the party in power repealing what has already been put into place, there’s no excuse for neglecting to articulate a vision for a financial sector that serves the greater interests of the real economy.

Mike Konczal is a Fellow at the Roosevelt Institute. More Mike Konczal.

Next Article

Related Stories

More Related Stories

Featured Slide Shows

The week in 10 pics

close X
  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 11
  • Lisa Montgomery embraces her nephew Thursday after a tornado tore apart her home in Cleburne, Texas. The twister killed six people and destroyed entire swaths of the North Texas town.
    Credit: AP/LM Otero

  • Jack McMahon, the defense attorney for abortion doctor Kermit Gosnell, speaks outside the Criminal Justice Center in Philadelphia Tuesday. His client was convicted of killing three babies in his clinic, and will serve multiple life sentences.
    Credit: AP/Matt Rourke

  • A photo taken Monday captures Vice President Joe Biden's response to a Milwaukee second-grader's innovative proposal to end America's epidemic of gun violence. This guy!
    Credit: AP/Jenny Aicher

  • Sen. Rand Paul, R-Ky., flanked by a grouper-eyed Michele Bachmann, addresses the IRS' admission that it targeted Tea Party groups in advance of the 2012 election. In an op-ed for CNN Thursday, the Kentucky senator slammed the president for his faux outrage.
    Credit: AP/Molly Riley

  • Ousted IRS chief Steven Miller is sworn in on Capitol Hill Friday. Miller testified before the House Ways and Means Committee on the extra scrutiny the agency gave conservative groups applying for tax-exempt status.
    Credit: AP/J. Scott Applewhite

  • Attorney General Eric Holder pauses as he testifies on Capitol Hill before the House Judiciary Committee Wednesday. Holder is under fire, among other things, for the Justice Department's gathering of phone records at the Associated Press.
    Credit: AP/Carolyn Kaster

  • O.J. Simpson sits during an evidentiary hearing at Clark County District Court in Las Vegas, Nev., Thursday. Simpson, who is currently serving a nine-to-33-year sentence in state prison for armed robbery and kidnapping, is using a writ of habeas corpus to seek a new trial.
    Credit: AP/Las Vegas Review-Journal/Jeff Scheid

  • Major Tom to ground control: On Sunday astronaut Chris Hadfield recorded the first music video from space, a cover of David Bowie's "Space Oddity."
    Credit: AP/NASA/Chris Hadfield

  • When it rains it pours. President Barack Obama speaks during a news conference Thursday with Turkish Prime Minister Recep Tayyip Erdogan, inexplicably inspiring an #umbrellagate Twitter meme.
    Credit: AP/Jacquelyn Martin

  • A smoke plume rises high above a road block at the intersection of County A and Ross Road east of Solon Springs, Wis., Tuesday. No injuries were reported, but the the wildfire caused evacuations across northwestern Wisconsin.
    Credit: AP/The Duluth News-Tribune/Clint Austin

  • Recent Slide Shows

  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 11

Related Videos

Comments

 0 Comments

Comment Preview

Your name will appear as username

You may use these HTML tags and attributes: <a href=""> <b> <em> <strong> <i> <blockquote>

follow salon

Most Read

Popular on Reddit

links from salon.com

From Around the Web

Presented by Scribol
listener_new_rect The Listener: Chekhov's story mirrors Russia's own

Recommendations