U.S. Senate leaders are launching into what they promise will be a major, landmark overhaul of regulations for the country’s financial institutions. Iowa Senator Tom Harkin, a Democrat, says he’s optimistic the legislation being created will gain swift bipartisan support, as Harkin says it’s something the people are demanding.
“Over the last two years, tens of millions of working Americans have lost their nest eggs, their jobs and/or their homes, as a direct consequence of run-amok greed and recklessness on Wall Street,” Harkin says. “Goldman Sachs and other bad actors believe they should remain free to continue business as usual with the very same abuses that helped bring our economy to its knees.”
Harkin says after preliminary discussions of the proposal, the legislation could go to the floor early next week. “Business as usual is not acceptable, certainly not for hard-working families in Iowa and across the country that have suffered because of Wall Street’s abuses,” Harkin says.
“Over the last decade, traders have gotten fabulously rich by gaming the unregulated financial casinos on Wall Street and when their house of cards came crashing down, they continued to collect multi-million dollar bonuses.” The bill is expected to establish a new government entity to shield consumers from crooked loans and mortgages. Harkin says there also needs to be a panel that would monitor the financial system for risks, while giving the government new powers over big investment houses that are on a shaky financial footing.
“I want to prevent any future taxpayer bailouts of so-called too-big-to-fail banks and companies,” Harkin says. “No more CitiGroups or AIGs. When companies make huge bets and lose, we need an orderly process for liquidating those companies, period.” Harkin also wants to see strong regulation of derivatives — which are essentially bets between private parties over future commodities costs.
During a Senate Ag Committee vote on Wednesday dealing with new limits on derivatives, Iowa Senator Chuck Grassley was the only Republican to join 12 Democrats in approving the measure.