Ky congressmen, except Yarmuth, vote against financial regulation bill

06/30/2010 08:04 PM

U.S. Rep. John Yarmuth, a Louisville Democrat, was the only member of Kentucky’s congressional delegation to support the bill aimed at tightening regulations on Wall Street as the legislation passed the House 237-192 Wednesday evening.

Yarmuth’s fellow Democrat, Rep. Ben Chandler of Versailles, was one of 19 from his party to vote against the legislation. He said in a statement shortly after the vote that the legislation simply fell short of protecting consumers and the economy in the future.

It was “full of holes and exceptions, did nothing to break up Wall Street banks, and did nothing to end the culture of greed, multi-million dollar bonuses, and golden parachutes for CEOs,” Chandler said in the statement.

“Instead of passing laws to place strict limits on these institutions, separating banks from insurance companies, or creating caps on size, the legislation merely gives more and unprecedented power to the same government bureaucrats who saw the warning signs before the economic crash, but did nothing,” Chandler added.

The 2,300-page financial industry regulation bill establishes a new agency within the Federal Reserve to serve as consumers’ watchdog of banks as well as a new set of guidelines to regulate the complex investments that were the root of the financial market collapse in 2008-2009, according to national media reports.

But opponents, including some in Kentucky, have argued that the bill adopted the wrong strategies to accomplish that.

“The bill unfairly targets institutions that had nothing to do with the financial collapse, such as Kentucky’s community banks, and leaves those who played a role in devastating our economy, such as Fannie Mae and Freddie Mac, untouched, so they can continue to cost taxpayers billions of dollars,” said U.S. Rep. Brett Guthrie, a Bowling Green Republican. “This bill also leaves taxpayers more exposed than ever to paying for mistakes made on Wall Street and in Washington. In no way can these solutions be described as effective reform.”

Guthrie said Republicans favored an approach that wouldn’t give government the power to essentially choose which institutions to bail out and which to let wither.

This latest version of the bill still must win final approval in the Senate, which won’t act on it this week.

- Ryan Alessi

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