Pallone Stumps For Financial Reform

Red Bank officials, businesses support banking overhaul

Atlanticville — Thursday, May 20, 2010

Staff Writer


With a financial reform bill moving closer to becoming a reality, Rep. Frank Pallone Jr. (D-6th District) held a rally to promote the reform in the heart of the Red Bank business district on Monday.

Local politicians, business owners and reform supporters attended the May 17 rally held in front of the Broadway Diner on Monmouth Street, where Pallone warned that they do not want another financial meltdown.

"The consequences for communities like this could have been dire," he said at the event, billed as a "Main Street to Wall Street Reform Effort."

"There was the bank bailout and the economic recovery package, and all these things made it so it didn't get worse.

Tom Fishkin, owner of Readie's Fine Foods in Red Bank, and Nancy Adams, executive director of Red Bank RiverCenter, discuss the importance of the proposed reforms for small businesses. "We don't want to repeat it," he added. "There is always the danger of sliding back, so we want to place reforms and restrictions on the financial sector so we don't have a repeat of what happened a year and a half ago."

The Wall Street Reform and Consumer Protection Act of 2009, or HR 4173, was passed by the House last December, with Pallone voting in favor. A similar bill is currently before the Senate and is expected to be voted on soon.

According to a press release from Pallone's legislative office, the reform bill would end bailouts, protect retirement funds, protect consumers and inject transparency and accountability into the financial system.

It would achieve those goals by creating a Consumer Financial ProtectionAgency, curtailing "too big to fail" financial firms, introducing new regulations to curb risky financial practices, and putting an end to predatory lending practices.

Pallone said there are steps in the bill to protect consumers from unfair practices.

"We tried to look at problems in the financial sector so it doesn't get worse and protect the consumers so we don't have the predatory lending," he said. "The biggest issue is unless you are dealing with stocks and bonds, you're not really aware of how your money's being spent."

He also said that he'd like to ensure that one company's misfortune does not spread to others.

"What we are saying is that we don't want these large concentrations in the market and we are not going to bail out companies again, we are just going to prevent the damage from spreading to other companies."

Pallone went on to say that there has been legislation passed recently designed to help small businesses.

"These bills have been designed to provide financial incentives for small businesses," he said.

One such provision, he said, is that employerswho hire unemployed people will pay reduced payroll tax.

"The other is trying to provide tax incentives for new businesses," he said. "A third one is trying to entice businesses to expand through tax incentives."

Pallone stressed the importance of small businesses in an economic recovery.

"We believe the way to create more jobs is to create more jobs in small business," he said. "The real way to create jobs is to provide incentives for small businesses."

Red Bank Mayor Pasquale Menna agreed that businesses are important to the health of the borough.

"We at the local level are looking at our ordinances to make them more business friendly and actually put people to work and to be able to effectively move forward into the 21st century," he said. "In the past, people have tried to create a chasm between the business community and the residents, and that is just stupid.

"The business community represents 44 percent of our taxes, and that is a net tax," he added. "They deserve our respect and assistance."

Nancy Adams, executive director of Red Bank River-Center, the alliance that manages the downtown district, agreed that the government should be assisting small businesses.

"There are so little tools available to them," she said. "What is really needed are some tools for some small businesses.

"The banks have not really been increasing their lending."

Adams said that she has seen more people around Red Bank but it hasn't necessarily translated into more business.

"We are seeing increasing foot traffic, but unfortunately those feet aren't attached to people with money like they used to be," she said. "We need those small business owners to keep their business going."

One Red Bank small business owner explained that all the businesses in Red Bank are somewhat related.

"All the businesses in town feed each other," Tom Fishkin, owner of Readie's Fine Foods, said. "There are less people everywhere, there are less people engaging in business transactions.

"There are less people walking around doing business-to-business transactions," he added.

Leslie Schlesinger, organizer with New Jersey Citizen Action, a statewide citizen watchdog coalition, said that this is a critical moment for financial reform.

"This is our chance to get financial reform done," she said. "We passed it in the House in December, and right now the final debate on amendments is in the Senate."

Schlesinger was critical of the amendments added to the bill.

"The devil is in the detail in all the little amendment s that are coming along," she said. "Wall Street is spending $1.4 million a day to lobby senators to vote on certain amendments.

"There is so much pressure from the Wall Street lobbyists to water down this bill."

Schlesinger said that Wall Street is unhappy with the bill, but Pallone argued that this would be best for them as well.

"I would argue that in the long run, another financial collapse isn't good for Wall Street," he said. "They obviously don't see it that way because they want to do whatever they want without any regulations."

Schlesinger also wanted to dispel rumors that reform would hurt businesses.

"I think there is this machine working that financial reform is not good for business," she said. "That simply is not the case."

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