WASHINGTON – After working for more than a year toward reform of our country’s financial sector, U.S. Senator Bob Corker, R-Tenn., today voted against the regulatory reform bill he had once hoped to cosponsor, saying the legislation is a “net negative” for the American public. Corker says the bill will make credit less available and more expensive, expand government bureaucracy, and hurt small- and medium-sized businesses. The bill, technically called “the conference report to accompany H.R. 4173,” passed by a vote of 60 to 38.
“I think I worked as hard as anyone in the Senate toward meaningful, bipartisan reform, but this legislation misses the mark,” says Corker. “It overreaches in areas that have nothing to do with this crisis or future financial stability and totally disregards some of the core issues that got us in this situation. In the final analysis, for the average American and most small businesses, this bill will cause credit to be less available and more expensive, dramatically increase the size of the federal bureaucracy, and do more to hurt community banks than to reform our country’s financial infrastructure. There will be unintended consequences, and, over time, I believe it could disadvantage our country in the global marketplace.
“In my view, today marks a tremendous missed opportunity on what could have been groundbreaking, long-overdue bipartisan reform of a regulatory framework that was not up to the task of reining in a rapidly growing and changing financial system. We had an opportunity to show the American people that we can work together on big issues and solve problems, and it’s a shame that we did not do that.
“My friends on the other side of the aisle like to call this bill ‘Wall Street reform,’ and our side likes to call it a ‘Wall Street bailout,’ but it is neither. Wall Street, with teams of compliance officers to deal with new regulations, in many ways comes out a winner because little will change. Small banks, forced to use their limited resources to comply with burdensome new reporting requirements, will suffer, as will the communities they serve.
“We punted most of the work to regulators who will spend the next several years making and implementing rules, which leaves tremendous ambiguity and instability at a time when businesses large and small desperately need certainty to survive and expand. There’s uncertainty about how the derivatives regulations will be interpreted which could put many of America’s employers in a wait-and-see mode before they can even consider hiring new employees. Farmers and other end users who use derivatives in their daily lives to hedge true business risks are panic stricken for clarity about whether they will have to put up more working capital or equipment as collateral against the risks they hedge, risks like the cost of fuel, steel and grain.
“Housing and mortgage finance policies – the root causes of the meltdown and the greatest symptoms of the correction – were left largely unaddressed in the bill.
“There is no doubt that we needed to address consumer protection, but instead of doing so appropriately, this bill creates a mammoth new government agency with dangerous, unchecked powers and enormous taxpayer monies at its disposal. Perhaps most alarming is that the fate of this organization, as well as its mission and activities, rests solely in the hands of one person, not one board or one agency, but one person. I find it totally irresponsible that Congress did not ensure appropriate checks and balances.
“Although I’m disappointed in the outcome of this debate, there is more work to do and my staff and I look forward to playing a constructive role in fixing some of the problems this bill will create, in addressing glaring omissions like Fannie Mae, Freddie Mac and our residential mortgage markets, and in preventing or lessening the negative impact this may have on the U.S. as it relates to our global competitiveness.” ###
U.S. Senator Bob Corker 185 Dirksen Senate Office Building Washington, D.C., 20510 phone: 202-224-3344 fax: 202-228-0566
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