The Dodd-Frank bill, like all major pieces of legislation, is tailor made for politicians. The rhetoric rains down like ticker tape, from supporters and detractors alike. Some might call this the “toughest restrictions on the financial industry since the Great Depression,” as the Washington Post did.
Others might lambaste it as a gross regulatory overreach that will kill American jobs and send the banking business overseas. The truth of course is obscured somewhere in the middle. You could take every major plank and argue it to death.
For example, some think the new consumer protection agency, which should come to life quickly, is a significant development. Others lament that car loans, as rife with fraud as any other type of loan, was put beyond the reach of the agency.
The Volcker Rule sounds good in theory, but even Paul Volcker notes it was significantly watered down.
So all in all, we’d have to sound two cheers for financial reform. Here are seven reasons why it can’t be three cheers. The big winners really are the lobbyists. They fought hard for the industry, and won more than a few victories. They will stay employed as they work to influence regulators over the long haul, as the bill leaves much to be decided. Some of the most important protections will not kick in until the current administration is long gone. When the spotlight dims, the lobbyists might really have their way. And we might never hear about it.
From Jim Kim on FierceFinance.com