A Step Backward in Financial Regulation
— May 25, 2017
By Kim Schoenholtz and Lawrence White
Although Congress enacted the Dodd-Frank Act in 2010 to prevent such crises from recurring, some of its provisions reflect that poor understanding. Rather than surgical precision, Dodd-Frank took an inefficient broad-brush approach to making the financial system safer. And despite being overly burdensome, it failed to address a range of issues, including the need to streamline the regulatory framework itself.
The Trump administration has said it wants to roll back the Dodd-Frank Act in the name of financial deregulation. And the House of Representatives may soon debate the Financial Choice Act -- the most prominent proposal for the reform of Dodd-Frank -- which was approved by the House Financial Services Committee earlier this month.
Read full article as published by BloombergView.
Kim Schoenholtz is Professor of Management Practice in the Department of Economics and Director of the Center for Global Economy and Business.
Lawrence White is the Robert Kavesh Professorship in Economics and the Deputy Chair, Economics.