Those terrifying months in late 2008 convinced me that the federal government needed to play a far more active role in policing the activities of the major financial players in our economy. This finance reform bill will do that.
Here's the greatest benefit this new test offers to voters. It lets us say to politicians, once and for all, on one of the most crucial issues of our day, those words every citizen longs to say to a long-winded public servant: Put up or shut up.
When push came to shove in late 2008, the banks' ultimate power was not that they were secretly controlling the levers of power, but that their place at the center of the financial system enabled them to hold the real economy hostage.
In their current form, derivatives are basically government insurance for banks where taxpayers pay the claims. And politicians like Gregg and Nelson are fighting to keep the crooked $600 trillion derivatives market unreformed.
With two-thirds of the nation supporting reform, any political party that throws in its lot with Wall Street will pay a major price come November. No amount of Wall Street campaign cash can counter voter outrage.
Senate Republicans say they're against both the bailouts and the Democrats' proposed legislation to end them. They say the Dodd bill would "actually guarantees future bailouts." It's time for the them to put up or shut up.
Anyone can talk tough when markets are calm. But in the middle of a financial crisis it takes a special breed of hard-ass to insist on haircuts, since no one can be sure that squeezing creditors won't shut down the entire bond market.
As bankers fight to defeat tough new rules on derivatives, all their sloganeers can come up with is that serious rules will send this business overseas. It'd be funny if Congress weren't taking it seriously.