Back in 2010, following the 2008 recession, lawmakers worked together to create legislation to prevent another financial crisis. The legislation, called the Dodd–Frank Wall Street Reform and Consumer Protection Act, tightened oversight of banks and financial markets in an attempt to prevent another crisis at the expense of taxpayer bailouts.
It was the response from Democrats who were worried about the potential of another recession.
But earlier this week, Republicans in Congress approved a bill that eases regulations required by the Dodd-Frank overhaul, despite the fact that those regulations were put in place to protect the economy from crashing again.
During the height of the financial crisis in 2008, the government stepped in to bail out crippled banks, including the largest Wall Street institutions, at the expense of taxpayers. The 2010 reform was meant to guard both banks from having too much power, as well as American workers who felt the pinch of the crisis in their bank accounts.
The loosening of oversight approved by House Republicans this week revises rules that limit banks’ riskiest trading bets–the same kind of risky bets that Wall Street took which led to the recession.
The securities and investment lobbying industry spent $74 million during the first three quarters of last year to get their agenda heard by Republicans in Congress, and the adjustments made this week prove that the desires of Wall Street special interests are more important to members of the GOP than their hardworking constituents.
Rep. Maxine Walters of California, who is on the House Financial Services Committee, called the Republican easing of regulations “[a] gift to a handful of the biggest Wall Street banks.”
Wall Street executives don’t need anymore breaks; the Great Recession proved that we can’t trust them, which is why the Dodd-Frank Act is such an important part of the checks and balances we need on Wall Street.