Issue Position: Wall Street Reform

Issue Position

The 2008 financial crisis and Great Recession destroyed 8.8 million jobs and $19.2 trillion of household wealth. Although many factors contributed to the financial crisis, the truth is Wall Street's greed led to the greatest economic crisis since the Great Depression. What is just as troubling is that our regulatory system let it happen.

Why did we let banks engage in subprime lending? Where were our regulators protecting consumers from predatory lending practices? Why did no one put a stop to big banks selling mortgage securities that were never examined and known to be defective? The answer is greed.

The response by Congress to the 2008 financial crisis has been woefully inadequate. I voted consistently against the Wall Street bailout.

What's more, the subsequent Dodd-Frank legislation failed to address the root causes of the financial crisis.

It did not: separate commercial banking from investment banking; end the "too big to fail" status of the largest institutions; rein in the credit rating agencies; require openness and transparency in the trading of derivatives; prevent Wall Street banks from replacing community banks; encourage prudent lending; strengthen support for those agencies finding and fighting fraud in our financial system; or, properly address the housing crisis.

Congresswoman Kaptur's legislation, the Return to Prudent Banking Act (H.R.129), would reinstate the provisions of the Glass-Steagall Act that keep investment banking separate from commercial banking. It would prevent the megabanks from engaging in speculative trading. It would also prohibit individuals from working for both an investment bank and a commercial depository bank.

Also, we must bring to justice those who engaged in illegal activity that contributed to the financial crisis. The biggest obstacle is not enough cops on the beat. Congresswoman Kaptur's bill, the Financial Crisis Investigation Act, (H.R. 131) would authorize hiring 1,000 agents and sufficient forensic experts to investigate financial crimes.

At the urging of the Ohio congressional delegation, the Committee on Financial Services held a hearing at Cleveland State University to examine some of the issues related to the foreclosure crisis and responses to it in the State of Ohio.

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