From the Archives: What Wall Street Reform Means for You
01:30 PM EDT
Watch the video on Wall Street Reform here.
President Obama signed the Wall Street Reform and Consumer Protection Act last June to prevent another financial crisis like the one in 2008 that erased trillions of dollars of household debt, left millions of Americans without jobs, and collapsed some of nation’s biggest financial institutions as well as our housing market.
The financial crisis was the result of a fundamental failure from Wall Street to Washington. Wall Street took irresponsible risks that they didn’t fully understand and Washington didn’t have the authority to properly monitor or constrain risk-taking at the largest firms. When the crisis hit, the government didn’t have the tools to break apart or wind down a failing financial firm without putting the American taxpayer and the entire financial system at risk.
The Wall Street Reform Act changed that. It established the Consumer Financial Protection Bureau to oversee and regulate banks and a whole range of financial industries--including some that had never been regulated before like payday lenders, private mortgage brokers, and debt collectors--to ensure we have the tools to avoid another crisis. And CFPB is the first-ever government agency charged with protecting and empowering American consumers-- the people who keep their money in banks, pay for goods and services with their credit cards, and rely on mortgages to buy homes or pay for college.
Unfortunately, the Senate is blocking the confirmation of the Richard Cordray, who President Obama has appointed to lead the Consumer Financial Protection Bureau. Without a Director in place, the Bureau's abilities to protect Americans from unfair, abusive, and deceptive practices at the hands of the financial industry are hamstrung, and our economy remains at risk.