U.S. Senator Debbie Stabenow (D-MI) today announced Senate passage of the Wall Street Reform and Consumer Protection Act of 2010. This legislation bans future taxpayer bailouts of Wall Street and holds big Wall Street banks accountable for the damage they caused our economy. It also gives Michigan families and businesses better information about their investments so they can make their own financial decisions. The House passed this bill last month, so it now goes to President Obama for his signature.
"The unregulated, reckless behavior on Wall Street cost our economy millions of jobs. Michigan was hit especially hard. The bill we passed today bans taxpayer bailouts of Wall Street banks and puts in place common-sense rules that will stop Wall Street from gambling with other people's homes, businesses and jobs," said Stabenow. "By stopping the abuses that led to the recent economic meltdown, we will save jobs and ensure economic stability."
According to a report by the Pew Economic Policy Group, the average American household lost $100,000 because of the recklessness on Wall Street. The report also concluded that 5.5 million additional jobs were lost due to slower economic growth during the financial crisis, compared to the September 2008 Congressional Budget Office predictions.
The Wall Street Reform and Consumer Protection Act of 2010:
Bans Wall Street Bailouts
* This bill guarantees that taxpayers will never again have to bail out Wall Street financial institutions.
Holds Wall Street Accountable
* This bill creates a new, independent bureau with clear authority to monitor banks, credit card companies, and other Wall Street firms for abusive practices -- and intervene when necessary to protect families and businesses.
* This bill establishes a council to identify and address the kind of systemic risks posed by large, complex companies and risky financial products that could threaten the stability of the overall economy.
Closes Loopholes and Strengthens Existing Regulations
* This bill eliminates loopholes that allowed reckless, abusive practices to go unnoticed and unregulated -- including loopholes for the kind of risky financial products that undermined our economy and led to the financial crisis.
* This bill strengthens mortgage lending standards and prevents the type of subprime mortgages that caused the crisis in the first place.
* This bill strengthens existing oversight powers to prevent financial fraud, conflicts of interest, and manipulation of the system that benefit special interests at the expense of families and businesses.
Gives Consumers and Businesses Financial Control
* This bill ensures that consumers get the information they need to shop for mortgages, credit cards, and other financial products in plain English -- and ends hidden fees and predatory lending practices.
* This bill makes sure consumers get free credit scores, along with a complete credit report, from credit reporting companies if they are denied loans or jobs because of poor credit. Currently, consumers must pay extra for these scores, which can cost more than $15 for each score.
* This bill sets aside $1 billion for emergency mortgage relief and $1 billion for a third round of funding for the Neighborhood Stabilization Program. Emergency mortgage relief will help homeowners who have lost their jobs get loans so they can continue to make mortgage payments while they are out of work. The Neighborhood Stabilization Program will enable local governments to purchase and redevelop foreclosed homes and residential properties. Similar programs have already had success in revitalizing Michigan neighborhoods.