Senator Dodd’s contentious financial regulation legislation passed the Senate last week, 59-39 after getting essential votes from Maine Republican Senators Olympia Snowe and Susan Collins. Republican Senators Scott Brown (R-Mass) and Charles Grassley (R-Iowa) joined Snowe and Collins to vote for the Restoring American Financial Stability Act of 2010, ensuring its passage.
“This was bad legislation from the start that was only made marginally less bad through the painful amendment process in the Senate. Making the failed risky lending policies permanent that led to the collapse of Fannie and Freddie are never ideas people with ‘R’s’ behind their name should support. There were enough reasons to oppose this bill that any conservative should have had no problem voting no. Apparently, Senators Snowe and Collins thought differently,” said Grover Norquist, President of Americans for Tax Reform.
Senator Dodd’s Restoring American Financial Stability Act did not address Fannie Mae and Freddie Mac’s precarious lending practices, two of the key factors behind the current economic crisis, while it codified bailouts for financial institutions. Additionally, the Democratic legislation expands the size and scope of government creating additional bureaucracies and further empowering regulators who failed to prevent or see the financial crisis two years ago.
“The real consequence of this will be to further delay our recovery by raising the cost of financial transactions and constricting the flow of capital throughout the American economy. Financial institutions, the heart of any economy, will need to comply with additional regulations. This will raise the cost per transaction, thereby, reducing the number that can take place. With near double digit unemployment, this legislation is the last thing we need.” Norquist added.