MANAGE & LEAD businesses by increasing government
to the average consumer. The goal
into being as part of President Obama’s
monitoring and regulation.
of this legislation is to avoid the
system of financial reform. However,
problem of banks becoming “too big
she did vote in favor of the bank bailout
already have become subject to some
to fail” and necessitating another
in 2008, despite expressing some
cumbersome restrictions. For example,
bailout. While in theory this policy
reservations about it, which seems to
hedge funds and firms are required to
would only affect large corporations,
indicate a desire to intervene to keep
fill out a costly and prohibitive amount
in practice it could place limitations
the banks going, if necessary.
of paperwork every year to ensure
even on smaller institutions, as they
compliance with the law. A “3 percent
too become increasingly limited in
Reserve’s plan to ban mandatory
rule” on the availability of mortgage
their ability to offer affordable loans.
arbitration clauses in bank contracts.
loans was also imposed. As a result,
Clinton has also stated her intention
Under Dodd-Frank, private lenders
Clinton also supports the Federal
This would result in a massive
home loans have become much less
to strengthen the Volcker Rule, which
upswing of litigation that will be costly
affordable to a vast segment of the
some think has already weakened
to financial institutions, and thus to
American population. With increased
banks by hindering competition.
consumers, as the cost is passed along
regulation, it is to be expected that such
Clinton’s plan is to extend the rule
to them through decreased availability
cost-prohibitive and lengthy paperwork
so that it applies to corners of the
of affordable loans.
will expand, as lenders are under an
banking world that have so far been
ever-increasing regulatory burden.
lightly regulated, such as hedge funds
has been criticized for her friendships
and insurance companies.
with big banks and corporations like
While Trump has expressed a desire to dismantle Dodd-Frank, Clinton
While Clinton does not endorse
It’s worth noting that Hillary Clinton
Goldman Sachs. She has even received
wants to strengthen and extend it. In a
reinstating Glass Steagall, as her
payment for speaking engagements
December 2015 New York Times op-ed
Democratic opponent Bernie
on Wall Street. Consequently, some
piece, she stated: “As president, I would
Sanders did, she has expressed a
voters are skeptical that she will really
not only veto any legislation that would
plan to enforce tighter regulations,
enact legislation that runs counter
weaken financial reform, but I would
which could lead to the downsizing
to the interests of such corporations.
also fight for tough new rules, stronger
and breakup of large financial
During her husband’s presidency, he
enforcement and more accountability
institutions that are too complex
deregulated the financial industry,
that go well beyond Dodd-Frank.” And
or risky. Thus it seems clear that
taking away many of the structures put
she has indicated some specific measures
this stance will bring lenders under
in place for the purpose of government
that she would take to accomplish this.
greater scrutiny. She also pledges
monitoring of financial institutions.
to mandate greater transparency in
Candidate Hillary Clinton shares some
financial institutions with more than
what she terms the “shadow banking
of the same advisers.
$50 billion in assets will have to pay
system.” She has even criticized
a graduated “risk fee.” Banks could
Sanders for having a “hands-off”
will stay strong in her support of
also pay a fee if they are identified as
approach to what she deems the
the Dodd-Frank Act, which Trump
“risky” by regulators. These fees will
riskiest activities in our economy.
seems bent on repealing—or at least
For one thing, she proposes that
It seems likely, though, that Clinton
augment the restrictions and capital
Her voting record while in Congress
requirements that have already been
supports this, as she repeatedly blocked
one that is embraced by people on
imposed on banks in the aftermath
Republican attempts to limit the power
both sides of the aisle; the cause of
of the financial crisis, leading to
of the Consumer Financial Protection
tougher restrictions on Wall Street is
further shrinking of loans available
Bureau, a regulatory agency that came
a popular one.
36 PRIVATE LENDER
weakening. Clinton’s position is