Obama signs sweeping US financial reform into law
- 21 July 2010
- From the section US & Canada
President Barack Obama has signed into law the biggest overhaul of American financial regulation in decades.
The president said the law will ensure "that everyone follows the same set of rules, so that firms compete on price and quality, not tricks and traps".
The law is a major victory for Mr Obama and the Democrats, who passed it with little Republican support after months of political wrangling.
It was vehemently opposed by the financial services industry.
The law tightens mortgage and consumer lending rules, improves disclosure for student borrowers and average investors and establishes a new consumer protection agency, among other provisions.
Almost every Congressional Republican opposed the bill, saying its new regulations would prove burdensome to businesses trying to create jobs.
The bill "fails to address the root causes of the kind of crisis it's meant to prevent", Senate Republican leader Mitch McConnell said last week.
"This is a bill that creates a vast new and unaccountable bureaucracy that, if past experience is any guide, will lead to countless burdensome, unintended consequences for individuals and small businesses, that will constrict credit and stifle growth in the middle of the worst economic period in memory."
But Mr Obama described the bill as a necessary measure to prevent future economic disaster, saying world's current economic troubles were caused in large part by "a breakdown in our financial system" and "a failure of responsibility from certain corners of Wall Street to the halls of power in Washington".
"Our financial system only works - our markets are only free - when there are clear rules and basic safeguards that prevent abuse, that check excess, that ensure that it is more profitable to play by the rules than to game the system," Mr Obama said at the White House.
In a note of irony, Obama signed the bill with great fanfare in the massive Ronald Reagan Building, named after a president who championed deregulation.
To a burst of applause, the president said: "Because of this law, the American people will never again be asked to foot the bill for Wall Street's mistakes."