Wall Street Strikes Back

Paul Krugman: “Last year the vampires of finance bought themselves a Congress … Let’s just note that these days Wall Street, which used to split its support between the parties, overwhelmingly favors the G.O.P. And the Republicans who came to power this year are returning the favor by trying to kill Dodd-Frank, the financial reform enacted in 2010.”

“And why must Dodd-Frank die? Because it’s working.”

“For one thing, the Consumer Financial Protection Bureau — the brainchild of Senator Elizabeth Warren — is, by all accounts, having a major chilling effect on abusive lending practices. And early indications are that enhanced regulation of financial derivatives — which played a major role in the 2008 crisis — is having similar effects, increasing transparency and reducing the profits of middlemen.”

“What about the problem of financial industry structure, sometimes oversimplified with the phrase ‘too big to fail?’ There, too, Dodd-Frank seems to be yielding real results, in fact, more than many supporters expected.”

“Republicans would love to undo Dodd-Frank, but they are, rightly, afraid of the glare of publicity that defenders of reform like Senator Warren — who inspires a remarkable amount of fear in the unrighteous — would shine on their efforts.”

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