Excess

Excess

Last year, failing banks handed out billions in bonuses to executives after taxpayers had bailed them out, rationalized by politicians calling these banking conglomerates 'too big to fail'. Now, the Obama Administration and Congress have taken a major, sweeping step towards ensuring that no bank is to big to fail and that never again will a late-night vote taken by Congress lead to taxpayer dollars being shoveled into the pockets of bloated banks.
The banking regulation reform bill orchestrated by Senator Chis Dodd and Representative Barney Frank, for whom the bill is named, will protect American consumers more than any financial regulations in history. In the past, nearly a dozen shrunken agencies were tasked with protecting consumers in different areas of the complex financial market. Resultantly, some areas were overprotected, with the bureaucratic mess making true consumer advocacy nearly impossible, while other sectors of the market were left completely untouched. Now, one reaching organization will protect Americans from all practices in the financial markets. Additionally, tough restrictions will provide new stability in the markets while pruning practices that endanger Americans.
Still, this bill is not quite as reaching as it ought to be. While in theory banks may now be 'too big to fail', this only applies to taxpayer bailouts. Banks can still combine and bloat, becoming impossible to regulate by any agency. Gramm-Leach-Blily, the law that allows consumer banking to meld with banking insurance companies and insure themselves is still enacted, creating a dangerous investment for consumers who assumed their finances were protected. Also, though regulation is now tougher than ever, the government is still unable to insure against taxpayer-hurting practices, like Wall St. banks frivolous handling of the TARP funds last year.
Even though the new law is far from perfect, it offers protection to consumers like never before. If the current regulations had been enacted a few years ago, the Goldman-Sachs fraud case would have been either more sparse or would have not happened at all, due entirely to the creation of the new protection agency.