New Dems Applaud Geithner’s Testimony on Reforming Derivatives Regulation
The New Democrat Coalition Financial Services Task Force, co-chaired by Coalition Whip Rep. Melissa Bean (IL-08) and Rep. Jim Himes (CT-04), along with the Coalition Leadership, applauded the Obama Administration's plans for reform of derivatives regulation and broader financial regulatory reform, as outlined by Treasury Secretary Timothy Geithner today before the Joint hearing of the House Financial Services Committee and the House Committee on Agriculture.
The New Dem Financial Services Task Force previously released 21 principles for regulatory reform. Two of those principles, mortgage reform and foreclosure avoidance, have already been passed by Congress. Thirteen are included in the recent proposal from the White House.
Today, the New Dem leadership and Financial Services Task Force released the following statement:
"Reforming our financial regulations is vital to preventing a repeat of the fiscal collapse and subsequent government intervention we experienced last fall. We need a vibrant and innovative American financial services sector lending to our families and businesses, but we need to assure that taxpayers are not asked again to shoulder the burden of a private company's risk.
"The President's proposal balances proper oversight of our financial markets with a structure that will not stifle market growth and innovation. While the trading of derivatives, such as credit default swaps, can be a valuable tool in managing risk for a wide range of businesses, including investors, farmers, and manufactures, unregulated and irresponsible trading of certain types of derivatives was a major factor in this crisis, and we join the President in supporting a reform of this market. If banks or other financial companies take a risk - no matter whether it's a credit default swap, an energy derivative, or an old-fashioned personal loan - they must have reasonable reserves to cover that risk. Bringing transparency to the derivatives market and ensuring that regulators have adequate information regarding firms' risk exposure through derivatives is vital to ensuring long-term growth in a stable economy."
The New Democrat Coalition is comprised of members committed to enacting policies that empower the U.S. to grow economically, maintain its competitiveness in the global marketplace, continue to be the world's leaders in innovation and technological advancement, and strengthen our economic and national security. The Coalition is dedicated to providing the leadership necessary to implement policies that will ensure that America maintains its prosperity and global leadership.
Statement supported by New Democrat Financial Services Task Force, co-chaired by Coalition Whip Rep. Melissa Bean (IL-08) and Rep. Jim Himes (CT-04) along with the Coalition Leadership including Representative Joseph Crowley (NY-07), Representative Ron Kind (WI-03), Representative Melissa Bean (IL-08), Representative Allyson Schwartz (PA-13) and Representative Adam Smith (WA-09).
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