An Iceberg of Financial Reform, but What Lies Beneath?

Mike Brownfield / June 25, 2010

A whopping 62 percent of Americans now say the United States is on the wrong track, yet President Barack Obama and liberals in Congress continue to steer the country in the same downhill direction toward bigger government. That runaway train picked up more speed this morning, as a House-Senate conference committee came to a final agreement on a Wall Street reform bill that’s packed with $19 billion in new taxes and fees on banks (which consumers will end up paying), a new consumer-unfriendly Consumer Financial Protection Bureau, and a complete failure to reform Fannie Mae and Freddie Mac (among the causes of America’s financial nightmare).

Though the Wall Street reform bill is aimed at solving the problems that led to America’s financial collapse, it entirely ignores one of the major culprits responsible for our fiscal mess – Fannie and Freddie. As the Wall Street Journal reports, “Government-controlled Fannie Mae and Freddie Mac remain a multibillion dollar drain on the U.S. Treasury, and largely untouched by this proposal.”

Given the sheer scope of the nearly 2,000 page bill, the biggest concern might be the unknown, unintended consequences that lie beneath. As Rep. Jeb Hensarling (R-TX) said during a conference committee meeting, “My guess is there are three unintended consequences on every page of this bill.” (more…)