It’s only November, but if Wall Street gets its way, Christmas could come early for the industry. That’s because its army of lobbyists are already hard at work, trying to hijack the appropriations process as a vehicle to enact its deregulatory wish list. Wall Street is essentially holding national priorities like health care, the environment and education hostage until members of Congress agree to put the industry’s narrow special interests before the interests of the American people.
A key priority for Wall Street this time around is eviscerating one of the most important institutions established under the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Financial Stability Oversight Council. This Council is our nation’s only early warning system for the threats posted by systemically significant nonbank financial firms like insurance giant AIG, which the government and taxpayers were forced to rescue during the 2008 financial crash.
There was broad-based, bipartisan and industry support for an entity like this in the wake of the financial crisis, including from the Financial Services Forum, the American Bankers Association, the Securities Industry and Financial Markets Association, and the Investment Company Institute. But as the crash recedes in memory, many in the industry are turning on the Council and trying to get their allies in Congress to attach provisions to the appropriations bill that would gut its authority and allow systematically significant nonbanks to go back to being unregulated despite the threat to taxpayers.
The risks to the Dodd-Frank Wall Street reform law don’t end there. The too-big-to-fail banks and their allies are also trying to undermine the work of the Consumer Financial Protection Bureau, an agency created under this law to protect consumers from unscrupulous business practices.