This is Bad for You: Dodd-Frank and the Volcker Rule on the Chopping Block

Bipartisanship sounds like a nice idea, however it seems to most frequently surround the shittiest of legislation. Reports are leaking out that the Senate Banking Committee is close to striking a deal on a bipartisan bill to weaken the Dodd-Frank Wall Street Reform Act. The weakening of Dodd-Frank, passed in 2010 in response to the financial crisis of 2007-2008, would be a big win for big banks and would increase the systemic risk in our economy, thereby increasing the likelihood of another financial crisis. Since it’s signing of less than 8 years ago, Dodd-Frank has improved financial stability and consumer protection.

In the most dangerous of ideas, the Senate Banking Committee is considering weakening the Volcker rule. While the Volcker rule is essential to stabilize our economy, it is also indispensable in developing a fair, just and ethical economy. Prior to the implementation of the Volcker rule, banks of any size were allowed to use the deposits made by regular consumers to make high risk speculative bets.  When those bets went wrong, such as we saw in the recent financial crisis, the losses were absorbed by the public through government bailouts. When those speculative bets turned out to be profitable, the profits only went to banks and not to the consumers whose deposits were used. Who wouldn’t love that arrangement?

Why is the Senate Banking Committee threatening to weaken Dodd-Frank? Simply put, because big money wants it done. The Volcker Rule is hated on Wall Street. They want to profit off of making big speculative bets while the rest of the country shoulders the risk.

There was near universal joy in the Democrat party following the victories in Tuesday’s elections, but Democratic support of the weakening of Dodd-Frank and the Volcker rule is a perfect example of how the fight for progressive policies does not begin or end with electing democrats to office. Most of our democrats in office are heavily influenced by the same donors and special interests that their friends on the other side of the aisle are influenced by. However, Democrats will and do respond to pressure from their constituents.

Call the Democratic Senators on the Senate Banking Committee and tell them not to touch Dodd-Frank and the Volcker Rule.

Jon Tester, MO (202) 224-2644
Heidi Heitkamp, ND (202) 224-2043 
Joe Donnelly, IN (202) 224-4814

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