The House financial reform conferees just had a quick mini-debate on the Volcker rule – they’ll have an extended discussion once the Senate has its say. The Volcker Rule would ban proprietary trading by commercial banks, to stop banks from using taxpayer-insured deposits to gamble in the Wall Street casino.
Rep. Bachus argues that the Volcker Rule will put the US at an international disadvantage and raise the cost of credit – sound familiar? Deregulation of the financial industry (see Demos on the repeal of the Glass-Steagall Act in the 90s) was achieved after a lot of argument against strong oversight – because it would hamper US competitiveness and raise the cost of credit.
Chairman Frank characterizes the Volcker Rule as a "fundamental party divide" between Dems and GOP. A broader bipartisan coalition than just GOP are carrying water for Wall Street (see Public Citizen on New Dems trying to weaken reform). But the chairman’s right that financial institutions are supposed to be facilitating peoples’ ability to save, and access to credit. They shouldn’t be trading solely as a profit center and putting all of our money at risk.
