Don't fight regulation, says Obama
Published 23/04/2010 | 05:00
AMERICA'S President Barack Obama called on the financial industry to drop the "furious effort" to fight his regulation plan, saying a failure to impose tougher rules on the market will put the US economic system at risk.
The US was almost dragged into a second Great Depression by "a failure of responsibility from Wall Street all the way to Washington," Mr Obama said yesterday in a speech he delivered at Cooper Union, about two miles from Wall Street.
"Some on Wall Street forgot that behind every dollar traded or leveraged, there's family looking to buy a house, or pay for an education, open a business, save for retirement," Mr Obama told an audience that included Lloyd Blankfein, chairman and chief executive officer of Goldman Sachs Group, local officials, consumer advocates, faculty and students.
What happens on Wall Street "has real consequences across our country, across our economy".
Mr Obama repeated the arguments he's been making for overhauling financial industry regulations over the past two years, a drive that is nearing its final stages.
His push to get the legislation through Congress got a boost when Democrats and Republicans resumed negotiations after weeks of trading accusations.
The effort has also been helped by the administration's ramped-up lobbying campaign and last week's announcement by the Securities and Exchange Commission that it is suing Goldman Sachs for alleged fraud linked to derivatives.
Mr Obama said financial firms as well as taxpayers will benefit by the imposition of new standards to prevent "reckless risk-taking", the creation of a mechanism to unwind institutions whose failure threatens the financial system, and a transparent market for trading derivatives.
He criticised the "battalions of financial industry lobbyists descending on Capitol Hill" to influence the legislation.
Goldman Sachs spent $1.2m (€900,000) lobbying between January and March, up from $670,000 during the same period a year ago, according to disclosures filed with Congress. (Bloomberg)