As financial reforms face new delays in Congress, the chair of the Congressional oversight panel on the troubled TARP program, Elizabeth Warren, told Truthout.org Tuesday that the nation's financial institutions still pose major risks for taxpayers -- and the economy.
She declared, "The rules that got us into this financial crisis have not yet been changed. Think of all the things we talked about a year ago and think about how little has changed. The too big to fail institutions are bigger, the banking industry is more concentrated, and the toxic assets remain on the books of the banks. Worse yet, the implicit government guarantee that let big companies take on high risks, then keep all the rewards if they succeed and get taxpayer bailouts when they failed, are even stronger than they were a year ago."
She added, "In other words, we are now operating under a set of rules that have proven to be disastrous, but we have not changed them."
Her concerns take on added urgency as sweeping financial reforms proposed in both the House and Senate face a buzz-saw of industry opposition that's already carved out important loopholes -- and fights over health care and rising Congressional anger over unemployment has pushed backed the time-table for financial reform. As TPMDC headlined last week, "Trouble Ahead For Obama? Congress In Chaos Over Economy," citing news reports:
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President Obama is facing an uprising from some of his allies in Congress over the economy. The Washington Post reports on "a wave of criticism and outright anger directed" at the White House as unemployment numbers continue to rise.
Many of the strongest critics are among Obama's strongest allies on the Hill, and the growing furor threatens to derail Obama's plan to reform the financial sector.
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On top of all that, leading economic experts and some former federal regulators, including William K. Black, a former official at the Federal Savings and Loan Insurance Corporation who helped expose the S&L scandal, are pointing to potential economic "bubbles" and risky speculation in fuel, Asian real-estate, securities and the Brazillian economy that could pave the way for anothe world-wide crash.
The Harvard Law School professor also helped unravel an ongoing economic mystery: Why hasn't all the money given to Wall Street firms and major banks -- over $4 trillion in direct TARP-related bailouts and guarantees --
