By Roxana Tiron - 03/20/10 10:00 AM EDT
President Barack Obama on Saturday slammed “the army of lobbyists” working against congressional reforms to the financial rules governing Wall Street.
In his weekly address, Obama focused solely on the need for financial reform, just as the House of Representatives prepared to cast a vote on the president’s hallmark effort: healthcare reform.
Obama, who has been hard at work convincing Democrats to vote in favor of healthcare reform, did not make any mention of the crucial Sunday vote in his address to the nation.
Instead, he focused on the need for financial reform and zoomed in on the creation of a consumer protection agency at the Federal Reserve to prevent predatory lending. Obama also took a swipe at Republicans for seeking to thwart the financial system overhaul in exchange for campaign contributions from the largest U.S. banks and their executives.
Obama decried the multi-million dollar campaign launched against the reform efforts. The Chamber of Commerce recently launched a $3 million campaign against efforts to set up a new consumer financial protection office. The Chamber has long campaigned against a standalone Consumer Financial Protection Agency as originally proposed by Obama and passed by the House in December.
“For these banking reforms to be complete – for these reforms to meet the measure of the crisis we’ve just been through – we need a consumer agency to advocate for ordinary Americans and help enforce the rules that protect them,” Obama said in his address Saturday.
“That’s why I won’t accept any attempts to undermine the independence of this agency. And I won’t accept efforts to create loopholes for the most egregious abusers of consumers, from payday lenders to auto finance companies to credit card companies.”
Obama stressed that the economic crisis started in the financial system with “large banks engaged in reckless financial speculation” without “tough oversight.”
“Financial firms invented and sold complicated financial products to escape scrutiny and conceal enormous risks,” Obama said. “And there were some who engaged in the rampant exploitation of consumers to turn a quick profit no matter who was hurt in the process.”
Obama said he is a strong supporter and defender of free markets, but without “reasonable and clear rules to check abuse and protect families, markets don’t function freely.”
“We need common-sense rules that will our allow markets to function fairly and freely while reining in the worst practices of the financial industry. That’s the central lesson of this crisis. And we fail to heed that lesson at our peril,” Obama said.
Meanwhile, Senate Banking Committee members have submitted hundreds of amendments to Dodd’s financial overhaul measure scheduled for markup on Monday. Committee staff members are expected to cull through the amendments to decide which get rolled into a more general manager's amendment (that would be submitted by Dodd) and which could be debated separately in committee.