The Health Care fight is (mostly) over. The next item on the agenda: Financial Regulation. I'm not sure if it made any headlines, but a little while back, the financial services sector of our economy kind of collapsed. In doing so, it took down the rest of the economy. And the world's economy.
Anyway, the crisis brought attention to the fact that there are large parts of the financial services industry that are largely unregulated. In an effort to not have all this happen again, Congress is writing a bunch of new laws to keep banks from blowing up the economy. There is still a lot of public anger toward Wall Street for their part in creating the mess out of which we're still slowly climbing our way.
This should be a slam dunk. The public wants to punish Wall Street, and in this age of populism neither party wants to be the party of Wall Street. On the other hand, the Republican party still cannot allow the Democrats to have any significant victories, especially after losing badly on health care. Wall Street is also spending plenty of money lobbying against any stringent new regulations. So how will anyone manage to oppose FinReg? By calling regulations a massive bailout. Nobody likes bailouts.
In reality, these regulations are intended to avoid the need for future bailouts. They limit leverage and empower regulators to force banks to come up with a plan to wind down without causing undue damage to the financial system as a whole. They also create an independent Consumer Financial Protection Agency, a huge priority of the White House. Paul Krugman has a column up with a very brief look at this really confusing issue.
Why do the Republicans think they can get away with characterizing an attempt to regulate banks and avoid bailouts as a bailout? Well, I'm going to have to leave it there.