Wall Street and banking industry: Democratic leaders should Endorse the Warren Wall Street reform agenda

At a time when the corporate shills in the Democratic party are increasingly voting with Republicans in Congress to gut the 2010 Dodd-Frank Wall Street reform law, Senator Warren spoke the truth about what’s really going on. "Republicans claim loudly and repeatedly that they support competitive markets,” she said, “but their approach to financial regulation is pure crony capitalism that helps the rich and the powerful protect and expand their power and leaves everyone else behind.

Most importantly, the senator from Massachusetts laid out a simple, no-nonsense agenda to complete the “unfinished business” of Wall Street reform ^.

* Hold financial institutions and individuals accountable for cheating customers. Stop offering “deferred prosecution” get-out-of-jail-free cards and giving special status to companies that were already caught breaking the law. Impose mandatory fines equal to the profits from illegal conduct. Make the governors of the Federal Reserve personally approve all settlement deals, and close the loophole that prevents the Consumer Financial Protection Bureau from protecting people buying a car.
* Stop financial institutions from passing risk on to taxpayers. Cap the size of big banks and break them up if they grow too large. Restrict the Federal Reserve’s emergency lending authority so banks know they won’t get a bailout for bad behavior. Pass the 21st Century Glass-Steagall Act to reinstate the barrier between commercial and investment banking that once prevented financial crises for decades.
* Change tax policies that encourage excessive risk-taking and financial instability. Reduce risky and pointless speculation with a small sales tax on certain financial transactions, like the one proposed by Representative Keith Ellison and backed by more than 65,000 CREDO members.⁶ Force companies to rely less on debt by ending the tax-deductibility of interest payments, and close the loophole that allows big companies to write off billions in bonuses for top executives.
* Create simple, structural rules for regulating the shadow banking sector. Companies that act just like banks but aren’t regulated like banks pose a massive risk to the financial system, and it is time regulators took the threat seriously.

"The fight over financial reform can't be over to back up a little or to back up a lot," Warren told reporters. "It has to be about finishing the job. She’s right – and so we need to demand that every Democrat get behind this agenda and commit to making it law.

EU-Digest