Thought you might be interested in the latest AEI Financial Services Outlook "The Dodd-Frank Act: Creative Destruction, Destroyed" by former Treasury and White House official Peter Wallison in which he spells out what the Dodd-Frank Act will unleash on the country and the consequences of the provisions included in the act. Wallison warns that the wholesale changes to the financial system will be lasting and are hard to explain except as the triumph of a fundamentally different view of the government's role in the U.S. economy-- a view as a corporatist political model more characteristic of Europe than America.
In particular, Wallison focuses on three key points:
The Dodd-Frank Act gives the Federal Reserve unprecedented control over the largest firms in the U.S. financial system which could result in a public-private partnership where the Fed protects the largest firms from competition and failure and they in turn follow the government's directions.
In the interest of protecting consumers, the act sacrifices the basic protections built into the U.S. Constitution, creating an agency--the Consumer Financial Protection Bureau--that is answerable to no one.
Ultimately, the act's effort to suppress risk taking will result in a decline in U.S. competitiveness, innovation, and economic growth.
The Outlook is available here: http://www.aei.org/outlook/100983.
To contact Peter Wallison, or for other media inquiries, please e-mail or call Veronique Rodman at [email protected] or 202.862.4871. Mr. Wallison's assistant can be reached at [email protected] or 202.419.5212.