Barney Frank Blasts GOP, Financial Institutions For Blocking Reform

By Vanessa Remmers

Rep. Barney Frank (D-Mass.) criticized House Republicans and the finance world Monday for opposing key aspects of financial regulatory reform.

“Some of the financial institutions sometimes sound like the 14-year-old child of divorced parents trying to play mommy against daddy, “Frank said during an appearance at the National Press Club. “I don’t think we have seen at this point any real apology.”

The Ranking Member of the House Financial Services Committee charged Republicans with advocating an economic Catch-22 by under-funding financial regulatory committees. Frank described Republican calls to block confirmation of heads of the Consumer Financial Protection Bureau unless changes are made to the agency’s structure as a “perversion of the Constitution.”

“I think many of them [financial institutions] recognize that while you may not like the rules in the first place, if you got the rules, you want them well run,” Frank said. “This [Catch-22] is coming from the ideologues in the Republican party who just believe, despite all the evidence to the contrary, that an unregulated free market works … it’s as if the last few years never happened.”

The major cause of concern for Rep. Frank, however, are arguments against risk retention on mortgage loans, which, according to the congressman, is a slippery slope to a sour economy.

“I am troubled because there is an assault now on risk retention,” Frank said. “I will acknowledge … we haven’t done it this way … it might cost us a little more … it’s disruptive … yes, it’s disruptive because we had to disrupt a rotten system which collapsed and it collapsed because risk was made to appear to disappear.”

On the international front, however, Frank said he was pleased with America’s leadership.

“We are the first nation to say hey, if you get in trouble, you’re dead,” Frank said. “We may have to minimize the mess you left behind, but if that costs us any money, it’s coming from your colleagues, it’s not coming out of the taxpayer.”