New York – President Barack Obama will call on Wall Street and industry lobbyists today to “join us, instead of fighting us” as Congress prepares to create new regulations to rein in the financial industry.
Obama will deliver a midday speech today at the Cooper Union, in the shadow of Wall Street, as the full Senate prepares to debate legislation to regulate derivatives, create a new consumer financial protection structure and give the government mechanisms to stave off bailouts of giants considered too big to fail.
The House of Representatives passed its own financial regulation late last year. Senate Republicans have been critical of Senate Democrats’ approach but in recent days have indicated a greater willingness to work toward a deal.
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The proposed reforms follow the nation’s housing crisis and recession, and the SEC’s move last week to bring fraud charges against giant Goldman Sachs.
In excerpts of the president’s remarks, released ahead of his speech, Obama says he believes in free markets, but that “a free market was never meant to be a free license to take whatever you can get, however you can get it. That is what happened too often in the years leading up to the crisis. Some on Wall Street forgot that behind every dollar traded or leveraged, there is family looking to buy a house, pay for an education, open a business, or save for retirement. What happens here has real consequences across our country.”
“I am here today because I want to urge you to join us, instead of fighting us in this effort,” the president plans to say. “I am here because I believe that these reforms are, in the end, not only in the best interest of our country, but in the best interest of our financial sector.”
Obama is to describe five elements he considers essential to the legislation:
- A system protecting the overall economy from a large firm’s failure
- Limiting the size of banks and what risks banks can take
- Bringing more transparency to derivatives markets
- Creating more consumer financial protections
- Giving investors and pension holders more say in who manages companies