BUSINESS

Lloyd Blankfein: Dodd-Frank Reforms May 'Turn Out To Be Inadequate'

10/02/2012 12:28 pm ET

Even Goldman Sachs CEO Lloyd Blankfein says there's a possibility some new financial rules may not be tough enough.

"A lot of the reforms contained in Dodd-Frank look good to me, and some of them look excessive, and some of them may even turn out to be inadequate," Blankfein said in an interview with Marketplace on Tuesday.

He added that since the Dodd-Frank Act of 2010 itself is so "skeletal," and because regulators have yet to finish implementing the rules, it's difficult to "make a judgment yet whether it's too much or not enough because we don’t really know what it is."

Such a statement by a major Wall Street CEO surprises, given banks last year alone spent $61 million on political lobbying, largely to water down the rules, according to the Center for Responsive Politics. It is unclear how much Goldman Sachs spent on political lobbying last year, since the company is not listed in the Center for Responsive Politics' list of banks whose lobbying expenditures it examined.

Blankfein has been notably open to financial reform since the crisis. He said in July that he would not eliminate Dodd-Frank even if he could, according to The New York Times. "The vast bulk of it is good," he said, while adding that "some parts go too far."

Some critics have argued that Dodd-Frank does not adequately address the issue of too-big-to-fail banks. In the future, they say, banks may continue to receive government bailouts in times of panic.

Blankfein, who served as Goldman's CEO when it received federal bailout money in 2008, did not directly answer a question from Marketplace about specific Dodd-Frank criticisms, but did say too much regulation can constrain the economy.

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