Easton baselessly suggests financial reform bill is going after “small community banks,” not Wall Street
Posted in Main Blog (All Posts) on July 19th, 2010 4:48 am by HL
Nina Easton suggested that the recently passed financial reform bill “doesn’t look like it’s going after Wall Street” and that instead it “has got small community banks, farmers concerned.” In fact, community bankers have expressed support for the bill and praised the distinction it draws between “Main Street community banks and Wall Street megabanks.”
Easton claims reform bill “doesn’t look like it’s going after Wall Street”
Easton: “You’ve got this Wall Street reform, that … doesn’t look like it’s going after Wall Street,” but rather “small community banks.” On the July 18 edition of Fox News Sunday, Fortune magazine’s Nina Easton suggested that President Obama is seeing his poll numbers drop because of policies that have created “lots of uncertainty and lots of fear.” She claimed that the financial reform bill “doesn’t look like it’s going after Wall Street,” and that instead it’s “got small community banks, farmers concerned.” From the broadcast:
EASTON: It’s fascinating, because this bill, which as you said was going to be the cracking down on fat cats of Wall Street, has got small community banks concerned, farmers concerned who deal in derivatives for their business. It’s got something like 533 rule-making proceedings are going to be going in, which creates lots of uncertainty and lots of fear. It’s interesting this week, the president in an interview said, look, I’m — when he was talking about poll numbers — look, I’m facing 9.5 percent unemployment. He’s got an unpopular economy, the same way President Bush in 2006 had an unpopular war. We grant him that. But what’s interesting is that these landmark pieces of legislation that the White House thought would help them in November are actually not — possibly not going to help him. You’ve got stimulus that most people don’t think helped. You’ve got a very divisive health care reform. And now, fascinating to us you’ve got this Wall Street reform, that doesn’t really — it’s really — it doesn’t look like it’s going after Wall Street.
Community bankers support financial reform bill
ICBA: “The Dodd/Frank Act does create an important precedent that recognizes two distinct sectors within the financial services spectrum.” The Independent Community Bankers of America (ICBA) issued a statement on July 15 noting that “the Dodd/Frank Act does create an important precedent that recognizes two distinct sectors within the financial services spectrum — Main Street community banks and Wall Street megabanks.” The press release also highlighted the fact that “[i]mportant ICBA-advocated wins in the bill such as changes in the FDIC assessment base, stricter oversight of too-big-to-fail institutions, and the inclusion of non-bank financial firms under consumer compliance regulations will save community banks money and allow them to better compete, serve their communities and promote economic growth in their markets.”
ICBA: Provisions in the financial reform bill “will save community banks roughly $4.5 billion over the next three years.” In a June 25 press release, ICBA chairman Jim MacPhee stated that a “change in the deposit insurance assessment base, which ICBA advocated, will save community banks roughly $4.5 billion over the next three years.” Additionally, MacPhee stated that the bill’s “provisions will go a long way to help community banks continue to do what they do best — serve the needs of their local communities.”
Financial reform bill targets Wall Street “superbanks”
Senate Banking Committee: Financial reform bill imposes “greater costs and restrictions on the superbanks” while “allowing community banks to continue serving their communities.” A March 29 press release from the Senate Committee on Banking, Housing, and Urban Affairs highlighted the differences between Wall Street firms and community banks, noting that “[s]ome giant Wall Street firms abused their customers and took enormous risks that nearly brought down our economy while our nation’s nearly 8,000 community banks have been responsible actors who have paid dearly for big banks’ mistakes.” The release went on to state that “[t]he financial reform bill reflects those differences, imposing greater costs and restrictions on the superbanks, reining in the abuses that caused the crisis, but allowing community banks to continue serving their communities.”
Reuters: Financial reform a “rewrite of Wall Street rules” that “subject it to tougher oversight and tighter restrictions.” A June 25 Reuters article noted that the financial reform bill is “a rewrite of Wall Street rules that may crimp the industry’s profits and subject it to tougher oversight and tighter restrictions.” The report highlights a provision of the bill that “forces much of the over-the-counter derivatives market, which worsened the financial crisis and led to a $182 billion bailout of insurer AIG, onto more accountable channels like clearinghouses and exchanges.”
