U.S. Rep. John Spratt (D-SC) praised Senate passage today of a bipartisan bill to rein in and regulate financial institutions. Spratt voted for the bill in the House last week.
"As we rebuild our economy," said Spratt, "we have to build in some plain common-sense rules which ensure that big commercial banks and big investment banks can't gamble on risks, like sub-prime mortgages, that jeopardize our economy."
The "Wall Street Reform and Consumer Protection Act" will police and help stop financial practices that almost led to a financial meltdown. The bill creates a process to shut down large, failing firms whose collapse would put the entire economy at risk. After exhausting all of the company's assets, additional costs would be covered by a "dissolution fund," to which all large financial firms would contribute. Henry Paulson, former Secretary of Treasury, has said that he wished such authority had been available when they resolved insolvencies at firms like AIG.
The bill has been called the "strongest set of Wall Street reforms in three generations" by Elizabeth Warren, who chairs the nonpartisan Congressional Oversight Panel. It has won endorsements across a broad range from the AARP to Consumers Union and the National Restaurant Association, among many others.