A CFPA supporter
December 1, 2009 | Illinois, federal legislation, industry | Comments (1)Rep. Melissa Bean (D-IL) says this about the CFPA in a suburban Chicago newspaper:
Most of the bills were inspired by last year’s economic collapse and credit crisis, which prompted a huge government banking bailout. “It was costly to taxpayers, and it was a dangerous precedent that implied government intervention when companies fail,” Bean said at a news conference at the Metcalf Federal Building in Chicago. “This kind of precedent we have to undo, and it’s the kind of mistake we can’t repeat.”
The cornerstone is the Financial Stability Improvement Act, which Bean said would avert government bailouts through accountability by creating a Systemic Dissolution Authority, which would be charged with overseeing the demise of failing firms previously deemed “too big to fail.”
“This is the anti-bailout. This means when a company fails, heads are going to roll. There will be consequences,” Bean said. “Essentially, if your company fails, you’re fired.”
No argument there. But why then throw in all the consumer lending services that are currently regulated by the states?
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Did the SEC catch Bernie Madoff? No. Selling this agency as a protector of capitalism is pretty silly.
I get her point “heads are going to roll”, but I do not think it will prevent a systemic meltdown b/c the uber rich rarely go to jail.