Obama Ready to Compromise on Finance Reform

Would sacrifice standalone consumer agency to pass bill
By Kevin Spak,  Newser Staff
Posted Feb 25, 2010 8:25 AM CST
President Barack Obama discusses the economy with the Business Roundtable as they meet at the St. Regis Hotel in Washington, Wednesday, Feb. 24, 2010.   (AP Photo/J. Scott Applewhite)

(Newser) – The Obama administration says it’s willing to scrap elements of its financial regulatory reform effort—particularly a standalone consumer protection agency—if it’ll help the bill sprint through Congress. Republicans have complained that a standalone agency would be a new bureaucracy, so team Obama says it’s open to housing it within an existing entity like the Treasury Department, provided it has the autonomy and power to do its job, the Washington Post reports.

The administration may also have to give up the “Volcker rule,” which would prohibit banks from engaging in risky investment activities that don’t benefit their customers. Senate leaders favor legislation that would leave it up to regulators, rather than the law, to ban such activities. Reform may also get a shot in the arm from Wall Street itself; industry officials say bank executives have moved from lobbying against reform to working with Democrats to shape it.

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