In this week’s Heritage in Focus, regulatory fellow Diane Katz discusses a provision in the regulatory reform bill, also known as Dodd-Frank, that is leading banks to increase debit card fees. Listen here. The provision, known as the “Durbin amendment,” limits the amount banks can charge retailers when consumers swipe their debit cards. As a result, Bank of America is set to start charging users $5 per month, while other banks are considering increased fees, as well. How will this affect jobs and economic growth? Will it encourage people to …
The newly created Consumer Financial Protection Bureau (CFPB) took a step forward today to getting its first director, as the Senate Banking Committee voted 12–10 to confirm Richard Cordray in the post. Even before the vote, however, President Obama raised the stakes. Referring to Bank of America’s decision to impose a $5 debit card fees, he declared that “this is exactly why we need somebody whose sole job it is to prevent this kind of stuff from happening.” The White House later tried to back off the President’s threat of …
The Senate Banking Committee welcomes Rep. Barney Frank (D-MA) to testify on the first anniversary of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The financial regulation bill has contributed to higher unemployment by imposing needless regulation on small and large financial institutions. It has deterred investment by imposing ill-defined restrictions on those who want to invest in the economy. The law has recently been under increased scrutiny. Today also marks the opening of the Consumer Financial Protection Bureau, created by Dodd-Frank. Heritage’s Diane Katz called it an “unchecked regulatory …
After more than a year of delay, the House Financial Services Committee is finally starting work on legislation that will hopefully end Fannie Mae and Freddie Mac, the two housing finance giants that helped to make the housing crisis worse. Both essentially failed in September 2008 and have been in a conservatorship under control of the Federal Housing Finance Agency since then. Many had hoped that Congress would address these two entities at the same time that it overhauled the financial regulatory system in the onerous Dodd–Frank legislation. But that …
The release of the final report(s) of the Financial Crisis Inquiry Commission (FCIC) brings to mind the story of several blind men trying to describe an elephant. One felt the legs and decided an elephant was like a forest, while another felt the trunk and decided that elephants are like snakes. Sadly, the FCIC went the same way by releasing three different reports, each of which reflects a certain view of the 2008 financial collapse. The majority report lists many causes of the crash but lays most of the blame …
When the Dodd-Frank financial-overhaul bill was passed last summer, it was done so with much of the fanfare and self-congratulation that has come to typify Washington. Then-Speaker of the House Nancy Pelosi (D-CA) called it the “toughest set of Wall Street reform in generations.” But the bill’s hype was not backed up with much substance. The legislation, which was sold as a response to the financial crisis, did not even address the problems of Fannie Mae or Freddie Mac and made TARP-style bailouts a permanent fixture of the government’s fiscal policy. And …
The Wall Street Journal reports today: Banks are considering additional fees on credit cards and checking accounts. But they also are looking at new ways to make money on cash machines and especially debit cards as regulators pinch the cards’ conventional revenue streams. And what exactly is to blame for all of these new fees and restrictions? WSJ reports: “The proposals, released last month, are part of the Dodd-Frank financial-overhaul bill that was enacted last year.” So much for Congress’ claim that Dodd-Frank would save consumers money. Before the bill …
The left just can not come to grips with the fact that their hyper-aggressive policy agenda is a major factor causing unemployment. Witness Mother Jones trying to debunk “The Uncertainty Meme” after reading USC business professor Ayse Imrohoroglu identify uncertainty as a confidence killer. On inflation Drum writes: Interest rates will remain very low for a very long time. The Fed has made this as clear as any central bank possibly could. The Fed certainly intends to keep interest rates, especially long-term interest rates low, but the Fed’s experiment in …
As President Obama today signed into law the Dodd-Frank financial regulation bill, two words were left unspoken: Fannie and Freddie. Yet they not only played a major role in creating the housing bubble that led to the meltdown of 2008, they stand today as the primary remaining bailout debtors to the U.S. treasury. As shown in this chart, the two bankrupt mortgage giants owe almost half — 45% — of the outstanding bailout money from the federal treasury. And as Heritage fellows David John and James Gattuso pointed out in …
Without spending a single dime, the Obama administration did more yesterday to create jobs for the U.S. economy than it has throughout its entire existence. With the single stroke of a pen, President Barack Obama signed the Dodd-Frank financial regulation bill that set in motion 243 new formal rule-makings by 11 different federal agencies. Each of the 243 rule-makings will employ hundreds of banking lobbyists as they try to shape what the final actual laws will look like. And when the rules are finally written, thousands of lawyers will bill …
