The current financial turmoil has changed Wall Street as we knew it forever. Seven decades worth of cumbersome, outdated, and harmful regulation will have to be rewritten in order to provide the clear and dependable rules markets need to operate. The long term financial health of the federal government also is in dire need of attention, and the current crisis has only made that problem worse.
But before that happens Congress must perform some very basic triage, dealing with the immediate crisis in the financial markets first. As explained in a new paper by Heritage’s David John, that became clear yesterday when congressional leaders rolled out a wish list of add-ons ranging from bankruptcy reform to low-income housing. The result? The Dow fell almost 375 points. The world is watching to see if Congress can act decisively. If Congress cannot pass a clean, standalone bill addressing the immediate financial market issues only, the president should veto it and force Congress to stay in town till they get it right.