U.S. Rep. Bean pushes financial reforms

U.S. Rep. Melissa Bean today touted a package of financial reform bills expected to pass out of House committee this week and designed to make the consumer credit system more secure.

"That doesn't mean more regulation. It means better regulation," said the Barrington Democrat.

Most of the bills were inspired by last year's economic collapse and credit crisis, which prompted a huge government banking bailout. "It was costly to taxpayers, and it was a dangerous precedent that implied government intervention when companies fail," Bean said at a news conference at the Metcalf Federal Building in Chicago. "This kind of precedent we have to undo, and it's the kind of mistake we can't repeat."

The cornerstone is the Financial Stability Improvement Act, which Bean said would avert government bailouts through accountability by creating a Systemic Dissolution Authority, which would be charged with overseeing the demise of failing firms previously deemed "too big to fail."

"This is the anti-bailout. This means when a company fails, heads are going to roll. There will be consequences," Bean said. "Essentially, if your company fails, you're fired."

Other pieces of the legislative package, including the Over-the-Counter Derivatives Market Act, the Investor Protection Act and the Accountability and Transparency in Rating Agencies Act, are designed to keep firms from failing through improved regulation and accountability. The Consumer Financial Protection Agency Act, meanwhile, would consolidate what is now an "alphabet soup" of government agencies, Bean said, under a single, stand-alone agency to create and enforce consumer-protection standards upon financial institutions.

"Regulatory reform may not be glamorous, but it is critical to creating a functional, sustainable financial system that families and businesses can count on," Bean said. "Consumer spending has a lot to do with consumer confidence," she added, and these "common-sense proposals" are designed to increase confidence in the financial system.

"Together, it should give us a stronger system, a more flexible system," she said.

Bean expects the package of bills to clear the House Financial Services Committee, of which she is a member, this week and advance to the House floor.