Five Year Anniversary of the Dodd-Frank Financial Reform Law:
Protecting America’s Families
Official White House photo by Lawrence Jackson
The Newseum
555 Pennsylvania Avenue
Washington, D.C. 20001
July 20, 2015
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In the few years since the financial reform law was passed, the
discussion has dramatically shifted:
• From the financial collapse, the economic crisis, the costs to
the country and the industry’s role in causing it all
• To the financial reform law, the rules necessary to implement
it, and the claimed costs from all that.
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The Cost of the Crisis:
$20 Trillion
and counting
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Friday, September 19, 2008: Morgan Stanley
and Goldman Sachs “toast”
From an internal Federal Reserve Bank of New York email dated Saturday, September 20, 2008,
recently revealed in the AIG trial:
“FYI, [Morgan Stanley] called [NY Fed President Tim Geithner] late last nite [Friday
September 19, 2008] and indicated they cannot open on Monday [September 22,
2008]. [Morgan Stanley] advised [Goldman Sachs] of this and [Goldman Sachs] is
now panicked because they feel that if [Morgan Stanley] does not open, then
[Goldman Sachs] is toast . . .”
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Treasury Guarantees $3.7 Trillion Money Market Industry
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$700 Billion TARP Bailout
Passed October 3, 2008
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$700 Billion TARP Bailout Was Just a
Small Part of the Trillions in Bailouts
Federal Reserve Board, Treasury and
FDIC guaranteed, lent or otherwise
used many trillions of dollars more in
bailouts and rescue programs.
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In addition to TARP, SOME of the government programs
providing bailouts and support include:
• Term Auction Facility
• Primary Credit Tri-Party
Repurchase Agreements
• Commercial Paper Funding
Facility
• Money Market Investor
Funding Facility
• Asset-Backed Commercial
Paper Money Market
Mutual Fund Liquidity
Facility
• Term Securities Lending
Facility (TSLF), TSLF Options
Program
• Primary Dealer Credit
Facility
• Temporary Liquidity (Debt)
Guarantee Program
• Asset-Backed Commercial
Paper Conduits
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Fed’s Zero Interest Rate Policy
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U.S. Federal Reserve Balance Sheet Total
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The Financial Crash Continued
Deep into 2009, as did the
Economic Crisis.
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Then there were the
enormous human, social
and government costs.
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To put that 17.5% rate into perspective, it equates to:
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Underwater Homes: Mortgages more than
homes could sell for
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There are tens of millions of
Americans and their families
behind those numbers.
Thousands of people turned out Wednesday, Feb. 11, 2009 for a job fair at the Atlanta Federal Center in downtown Atlanta. The line snaked
around the block and then back again on itself, requiring three lines in spots.
Children at Wicklow Elementary in Sanford, Florida, get lunch at the cafeteria, October 14, 2011. Every weekday more than 200,000 hungry
students in Central Florida public schools line up to get lunch for free or a few cents because their families cannot afford to feed them. In the
County, the economy is so bad that seven out of every 10 students - 71% - are eligible for free or reduced price meals under the federally
subsidized school lunch program.
Fellow firefighters applaud as a five-year-veteran of the Camden Fire Department tells them to keep their hopes up as they prepare to turn in
their gear after being laid off. Camden laid off a third of its firefighters.
A recently laid off man waits to apply for food stamps at the Cooperative Feeding Program on February 10, 2011 in Fort Lauderdale, Florida.
Recent statistics show that nationwide, one in seven Americans receives help from the Federal government with buying food. The food stamp
program was used by 43.6 million people in November 2010, up from 26 million just two years ago.
In this Dec. 17, 2010 photo, a woman holds an unemployment check in her home in Burbank, Calif. Before she was laid off from a quality
assurance job at Yahoo! in July 2009, she earned around $100,000 a year. “It really gets me when they say ‘you lazy people,’” she said. “They
have no idea how depressing that is when you have been beating your head against the wall, trying to find work.”
With tax revenues plummeting
and social needs skyrocketing,
government deficits and debt
ballooned.
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U.S. Deficit 2002-2012 (in millions of dollars)
$1,600,000.00
$1,400,000.00
$1,200,000.00
$1,000,000.00
Deficit
($millions)
$800,000.00
$600,000.00
$400,000.00
$200,000.00
$2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Year
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The same thing has
happened in the private
charitable sector.
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• Public finances tremendously
stressed
• Deficits and debt drive decisionmaking
• Private charitable activities suffered
• large endowment losses &
contribution declines
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Just one example: Federal financing for research and development
in billions (adjusted for inflation)
$195
$185
$175
$165
$155
$145
$135
$125
2009
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2014
Source: New York Times
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But, it’s not just R&D that has been cut or made worse:
• Inequality
• Education
• Poverty
• AIDS
• Arts
• Science
• Health Care
• Aging/Seniors
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• Unemployment/Jobs
• Housing
• Environment
• Economic Opportunity
• Energy
• Innovation
• Business Creation
• Drug Abuse
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Let me conclude by mentioning just one other
cost, which is never mentioned:
• The exploitation of financial reform for political
and partisan gain.
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The economic calamity caused by the financial crash hit
everyone regardless of party affiliation
United States Average 16.8%
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The financial crash and the economic
catastrophe it caused is what made financial
reform and Dodd-Frank absolutely essential.
Preventing that from happening again is
what financial reform is all about.
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• Protecting American’s jobs, businesses,
homes, savings, retirements, and standard of
living; and
• Making sure that public funds are never again
diverted from social priorities to bail out
reckless financial activities.
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That’s also why the Dodd-Frank financial
reform law must be fully implemented and
aggressively policed
• as soon as possible,
• as strongly as possible, and
• as durably as possible.
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