The New York Times reports: “President Trump on Friday moved to chisel away at the Obama administration’s legacy on financial regulation, announcing steps to revisit the rules enacted after the 2008 financial crisis and to back away from a measure intended to protect consumers from bad investment advice. After a White House meeting with executives from Wall Street, Mr. Trump signed a directive aimed at the Dodd-Frank Act, crafted by the Obama administration and passed by Congress in response to the 2008 meltdown.”
WILLIAM K. BLACK, blackw [at] umkc.edu, @williamkblack
Black is an associate professor of economics and law at the University of Missouri-Kansas City. A former bank regulator who led investigations of the savings and loan crisis of the 1980s, he is the author of the book The Best Way to Rob a Bank is to Own One.
In his recent interview with The Real News, “Trump Set to Rollback Financial Regulation Passed After the 2008 Crisis,” Black states: “This supposed populist who ran against big banks, against Goldman Sachs, has of course, appointed all these top people in finance. That’s who he’s listening to, not small business people. And so he said that Dodd-Frank has been disastrous, which is hilarious — you know, bank profits are high, their capital levels are much higher, it’s just ridiculous — and said, we’re really going to do a number on that. And Mnuchin has said that he’s going to go after the Volcker Rule.
“But, of course, this is an area where the new Democrats have neutered themselves because, if you recall, Hillary Clinton, supported by Paul Krugman [of the New York Times], said: No, no, no. Don’t bring back Glass-Steagall.
“Well, think how much shorter Dodd-Frank could have been if it had done intelligent things like the following: ‘The act repealing Glass-Steagall is hereby repealed. The interpretive rules as of 1965 are hereby reinstated 180 days after the effective date of this statute.’ That removes about 350 pages of statutes and about 2,000 pages of Volcker regulations and interpretations. And, ‘The Commodities Future Modernization Act is repealed’ — that would have saved, again, 120 pages of statute perhaps and 600 pages of regulation.
“So, because Obama and the new Democrats lacked the courage to actually unwind the Clinton Era and Bush Era deregulation; and because they never created an understanding in the populace of what caused the crisis, which was these three epidemics of elite fraud, you could almost never hear the word fraud even uttered by the President or Hillary Clinton, right? — there was nothing to push back against.”
Also see other recent interviews with Black: “Republicans Plan to “De-Supervise” the Consumer Financial Protection Board” and “Private Sector Will Make a Killing Off of Infrastructure Bank.”
Trump said during the presidential campaign: “The hedge fund guys are getting away with murder. They’re making a tremendous amount of money. They have to pay taxes. I want to lower the rates for the middle class. The middle class is the one, they’re getting absolutely destroyed. This country doesn’t have — won’t have a middle class very soon.” See Forture magazine.
