Almost three years after President Obama signed the Dodd–Frank Wall Street Reform and Consumer Protection Act into law, few of its provisions have actually come into effect. Thanks in part to the banking lobby, the process is stuck in what The Washington Monthly calls “the seventh circle of bureaucratic hell.” We checked in with Economist Simon Johnson to find out where things stand and whether we should be worried.
Lauren Feeney: What’s the current status of the Dodd-Frank Act?
Simon Johnson: Implementation of the Dodd-Frank act has been painfully slow – and much slower than anyone imagined when the legislation passed in the summer of 2010.
The good news is that efforts to repeal Dodd-Frank have largely, although not completely, run out of steam.
Feeney: Why is progress so slow?
Johnson: The financial sector is a very powerful lobby. They have many friends on Capitol Hill and some parts of our country’s regulatory apparatus remained unduly captivated, if not captured, by the mystique of mathematical finance.
Feeney: The Volcker Rule, one of the key components of Dodd Frank, was supposed to go into effect in July 2012. It’s still not in place. What’s the holdup?
Johnson: The lobby.
Keep reading: Don't Count on Dodd-Frank… Yet | Q&A | BillMoyers.com.
Simon Johnson. Photo credit: Robin Holland
Simon Johnson is a former chief economist of the International Monetary Fund and now a professor at MIT’s Sloan School of Management and senior fellow at the Peterson Institute for International Economics. His most recent book is White House Burning: The Founding Fathers, Our National Debt, and Why It Matters to You. Johnson spoke with Bill Moyers in May about JP Morgan’s multi-billion dollar loss.