Saturday, January 12, 2013

Dodd-Frank monumental failure for American economy


George Mason Univ. Mercatus Ctr.

More than 360,000 words in length, the Dodd-Frank Wall Street Reform and Consumer Protection Act is the longest and most complex piece of financial legislation in American history. A new book released today by the Mercatus Center at George Mason University examines the poorly-structured law and what anxious investors and financial experts need to watch for in the coming year.

Following the 2008 financial crisis and subsequent federal bailout, Congress and the administration approved the law to curb the irresponsible Wall Street activity and to protect consumers. Dodd-Frank: What it Does and Why it’s Flawed argues that it missed the mark on both counts.

Mercatus Center senior scholar Hester Peirce and her co-authors show that Dodd-Frank doesn’t take away the artificial public safety net for “too-big-to-fail” firms. Instead, poorly designed consumer protections pass more costs onto consumers and give them fewer financial options. Perhaps worst of all, Dodd-Frank gives greater regulatory oversight to the same regulators that haven’t managed to adequately handle their current list of market monitoring responsibilities.

Peirce’s unique understanding of the process comes from her tenure as senior counsel to U.S. Sen. Richard C. Shelby on the Senate Banking Committee, where Peirce worked firsthand on financial regulatory reform and efforts related to Dodd-Frank. Dodd-Frank: What it Does and Why it’s Flawed is available for $12.95 on Amazon and for $3.99 on Kindle.

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