2008 was a bad year for the Stock Market, and as Wall Street tumbled many Americans tumbled with it as jobs were lost, retirement accounts were decimated, and homes were repossessed. The troubles on Wall Street sent shock waves through the rest of the economy triggering the worst recession since the Great Depression and now, two years later, we haven't recovered yet.
The last thing America needs is a repeat of 2008, which is why it was critical to pass legislation to reform Wall Street and keep Americans from ever having to foot the bill again for those who fly fast and furious with other peoples' money.
The Wall Street reform bill that is now law aims to avert another financial crisis. It ends bailouts, adds common sense consumer protections, and makes sure that Nebraska Main Street businesses are not adversely affected as we rein in recklessness on Wall Street.
Nebraskans didn't act irresponsibly and cause the problems, but we had to help solve them. It boils down to this: Nebraska taxpayers and consumers have already been asked to bail out banks and now we must provide protection from future abuses by Wall Street. Those abuses cost thousands of Nebraskans and millions of Americans their jobs, savings, and financial security as our country's economy reached the brink of collapse.
This law will protect and empower consumers with new transparency and accountability, and it does so without raising taxes.
The following are some highlights of the new law that will not only help Nebraskans but will make sure our country isn't again faced with a financial meltdown. The Wall Street reforms:
o Prohibit taxpayer money from being used for future bank bailouts. Ends "too big to fail" bailouts.
o Provide comprehensive, transparent regulation of the multi-trillion dollar derivatives market, the creative financial instruments few understand that are largely responsible for the economic crisis.
o Provide for an audit of the Federal Reserve.
o Protect Main Street from footing the bill for Wall Street. The bill now broadens the assessment base used by the FDIC to determine bank premiums. Big banks that take big risks will pay more and community banks pay less, leaving $4.5 billion over the next three years in community banks. This provision was a high priority for Nebraska community banks.
o Ensure that fees for accepting debit cards are reasonable and in line with the costs of processing transactions.
o Require that compensation for senior executives of failed financial firms be paid last, after all other creditors.
o Eliminate loopholes that allow risky and abusive practices to go on unnoticed and unregulated -- including loopholes for asset-backed securities, hedge funds, mortgage brokers and payday lenders.
Through these reforms we will be able to keep a close eye on Wall Street to protect our country from economic catastrophe in the future. The Wall Street Reform bill is a true consumer protection act that will help taxpayers and the economy recover, while helping to assure what we've been through since 2008 never happens again.