The Political Importance of Elizabeth Warren
WASHINGTON, DC – Financial reform in the United States and worldwide hangs in the balance. The problems that brought us the terrible crisis of 2007-08 have not been fixed. Some underlying weaknesses are actually worse than they were a decade ago, including the problem of “too big to fail” global megabanks.
Europe is backtracking on financial reform issues; its policymakers are too preoccupied with holding the eurozone together. In the US, there will be no new legislation under the current Congress – and probably not for a long while to come. The Dodd-Frank Act of 2010 may turn out to be a framework for effective regulation, or it might become another set of empty promises. So far, implementation has been slow.
Implementation depends on regulators – some of whom are very good, while others remain in thrall to the big Wall Street banks. The issues are detailed and technical, and the financial lobby has deployed a small army of highly paid experts on a mission of delay, dilution, and diversion. The process is still subject to political supervision, but many politicians are easily bamboozled when the conversation really gets into the weeds.