House Passes Financial Regulatory Reform

This afternoon the House passed its version of financial regulatory reform - the Wall Street and Consumer Protection Act - by a vote of 223 to 220. No Republicans voted in favor of the bill. The New York Times called it “the most significant legislative act to confront the financial crisis that exploded last year...”

According to the Times, key provisions included in the bill include:

The bill’s principal provisions establish a process for dismantling large, failing financial institutions; set up a council to identify and regulate firms that are so big, interconnected or risky that they need heightened supervision to keep them from bringing down the whole financial system; create a new consumer financial-protection agency to squelch unfair and abusive practices; and for the first time, regulate over-the-counter derivatives markets. The bill also contains provisions on executive pay, investor protection, credit ratings, hedge funds and insurance.

DNC Chairman Tim Kaine issued the statement below after the vote:

“Today, thanks to the leadership of House Speaker Nancy Pelosi, Chairman Barney Frank (D-MA) and other leading Democrats, the House took an important step towards creating a more stable financial system by passing the Wall Street Reform and Consumer Protection Act of 2009. The Act will reform the way we regulate our financial sector by creating new rules that will make our system more stable, while reining in the irresponsible practices that nearly led to the collapse of the global financial system. The legislation would also create a new consumer financial-protection agency that would stop unfair and abusive practices that harmed consumers.

“Unfortunately, not one Republican voted for the bill. Not one.

“Last fall, the excessive greed and risk taking of Wall Street brought Main Street to its knees. Now, instead of standing up to the special interests and supporting action that would ensure a regulatory framework that puts an end to unrestrained risk-taking, Republicans have once again sided with their banking industry friends instead of helping working Americans who are already shouldering the tab for Wall Street’s reckless decisions. Republicans are once again on the sidelines - defending their special interest friends and failing to offer any new solutions.

“Democrats will continue to work with President Obama to craft final financial regulatory reform legislation that makes sure our financial system works for the American people.”