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Remarks by the President at Signing of Dodd-Frank Wall Street Reform and Consumer Protection Act

of the Press Secretary

For Immediate
July 21, 2010


Ronald Reagan
11:34 A.M. EDT

Well, good morning, everyone.


are gathered in the heart of our nation’s capital, surrounded by memorials to
leaders and citizens who served our nation in its earliest days and in its days
of greatest trial. Today is such a time for America.

Over the past two
years, we have faced the worst recession since the Great Depression. Eight
million people lost their jobs. Tens of millions saw the value of their homes
and retirement savings plummet. Countless businesses have been unable to get
the loans they need and many have been forced to shut their doors. And although
the economy is growing again, too many people are still feeling the pain of the

Now, while a number
of factors led to such a severe recession, the primary cause was a breakdown in
our financial system. It was a crisis born of a failure of responsibility from
certain corners of Wall Street to the halls of power in Washington. For years,
our financial sector was governed by antiquated and poorly enforced rules that
allowed some to game the system and take risks that endangered the entire

lenders locked consumers into complex loans with hidden costs. Firms like AIG
placed massive, risky bets with borrowed money. And while the rules left abuse
and excess unchecked, they also left taxpayers on the hook if a big bank or
financial institution ever failed.

Now, even before
the crisis hit, I went to Wall Street and I called for common-sense reforms to
protect consumers and our economy as a whole. And soon after taking office, I
proposed a set of reforms to empower consumers and investors, to bring the
shadowy deals that caused this crisis into the light of day, and to put a stop
to taxpayer bailouts once and for all. (Applause.) Today, thanks to a lot of
people in this room, those reforms will become the law of the land.

For the last year,
Chairmen Barney Frank and Chris Dodd have worked day and night — (applause) —
Barney and Chris have worked day and night to bring about this reform. And I am
profoundly grateful to them. I would be remiss if I didn’t also express my
appreciation to Senator Harry Reid and Speaker Nancy Pelosi for their
leadership. It wouldn’t have happened without them. (Applause.)

Passing this bill
was no easy task. To get there, we had to overcome the furious lobbying of an
array of powerful interest groups and a partisan minority determined to block
change. So the members who are here today, both on the stage and in the
audience, they have done a great service in devoting so much time and expertise
to this effort, to looking out for the public interests and not the special
interests. (Applause.) And I also want to thank the three Republican senators
who put partisanship aside — (applause) — judged this bill on the merits, and
voted for reform. We’re grateful to them. (Applause.) And the Republican
House members. (Applause.) Good to see you, Joe. (Applause.)

Now, let’s put this
in perspective. The fact is, the financial industry is central to our nation’s
ability to grow, to prosper, to compete and to innovate. There are a lot of
banks that understand and fulfill this vital role, and there are a whole lot of
bankers who want to do right — and do right — by their customers. This reform
will help foster innovation, not hamper it. It is designed to make sure that
everybody follows the same set of rules, so that firms compete on price and
quality, not on tricks and not on traps.

It demands
accountability and responsibility from everyone. It provides certainty to
everybody, from bankers to farmers to business owners to consumers. And unless
your business model depends on cutting corners or bilking your customers, you’ve
got nothing to fear from reform. (Applause.)

Now, for all those
Americans who are wondering what Wall Street reform means for you, here’s what
you can expect. If you’ve ever applied for a credit card, a student loan, or a
mortgage, you know the feeling of signing your name to pages of barely
understandable fine print. What often happens as a result is that many
Americans are caught by hidden fees and penalties, or saddled with loans they
can’t afford.

That’s what
happened to Robin Fox, hit with a massive rate increase on her credit card
balance even though she paid her bills on time. That’s what happened to Andrew
Giordano, who discovered hundreds of dollars in overdraft fees on his bank
statement –- fees he had no idea he might face.. Both are here today. Well,
with this law, unfair rate hikes, like the one that hit Robin, will end for
good. (Applause.) And we’ll ensure that people like Andrew aren’t unwittingly
caught by overdraft fees when they sign up for a checking account. (Applause.)

With this law,
we’ll crack down on abusive practices in the mortgage industry. We’ll make sure
that contracts are simpler -– putting an end to many hidden penalties and fees
in complex mortgages -– so folks know what they’re signing.

With this law,
students who take out college loans will be provided clear and concise
information about their obligations.

And with this law,
ordinary investors -– like seniors and folks saving for retirement –- will be
able to receive more information about the costs and risks of mutual funds and
other investment products, so that they can make better financial decisions as
to what will work for them.

So, all told, these
reforms represent the strongest consumer financial protections in history.
(Applause.) In history. And these protections will be enforced by a new
consumer watchdog with just one job: looking out for people -– not big banks,
not lenders, not investment houses -– looking out for people as they interact
with the financial system.

And that’s not just
good for consumers; that’s good for the economy. Because reform will put a stop
to a lot of the bad loans that fueled a debt-based bubble. And it will mean all
companies will have to seek customers by offering better products, instead of
more deceptive ones.

Now, beyond the
consumer protections I’ve outlined, reform will also rein in the abuse and
excess that nearly brought down our financial system. It will finally bring
transparency to the kinds of complex and risky transactions that helped trigger
the financial crisis. Shareholders will also have a greater say on the pay of
CEOs and other executives, so they can reward success instead of

And finally,
because of this law, the American people will never again be asked to foot the
bill for Wall Street’s mistakes. (Applause.) There will be no more tax-funded
bailouts — period. (Applause.) If a large financial institution should ever
fail, this reform gives us the ability to wind it down without endangering the
broader economy. And there will be new rules to make clear that no firm is
somehow protected because it is “too big to fail,” so we don’t have another

That’s what this
reform will mean. Now, it doesn’t mean our work is over. For these new rules
to be effective, regulators will have to be vigilant. We may need to make
adjustments along the way as our financial system adapts to these new changes
and changes around the globe. No law can force anybody to be responsible; it’s
still incumbent on those on Wall Street to heed the lessons of this crisis in
terms of how they conduct their businesses.

The fact is every
American -– from Main Street to Wall Street –- has a stake in our financial
system. Wall Street banks and firms invest the capital that makes it possible
for start-ups to sell new products. They provide loans to businesses to expand
and to hire. They back mortgages for families purchasing a new home. That’s
why we’ll all stand to gain from these reforms. We all win when investors
around the world have confidence in our markets. We all win when shareholders
have more power and more information. We all win when consumers are protected
against abuse. And we all win when folks are rewarded based on how well they
perform, not how well they evade accountability.

In the end, our
financial system only works –- our market is only free –- when there are clear
rules and basic safeguards that prevent abuse, that check excess, that ensure
that it is more profitable to play by the rules than to game the system. And
that’s what these reforms are designed to achieve — no more, no less. Because
that’s how we will ensure that our economy works for consumers, that it works
for investors, that it works for financial institutions -– that it works for all
of us.

This is the central
lesson not only of this crisis but of our history. Ultimately, there’s no
dividing line between Main Street and Wall Street. We rise or fall together as
one nation. So these reforms will help lift our economy and lead all of us to a
stronger, more prosperous future.

And that’s why I’m
so honored to sign these reforms into law, and I’m so grateful to everybody who
worked so hard to make this day possible. Thank you very much, everybody.

(The bill is
signed.) (Applause.)

END 11:48 A.M. EDT




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