Asbury Park Press

Pallone Pushes For Wall Street Reform

House passes act now before Senate

Asbury Park Press — Monday, May 17, 2010


Photo (l–r): Red Bank Councilman Ed Zipprich and Mayor Pasquale Menna join Rep. Frank Pallone Jr. and Leslie Schlesinger, of NJ Citizen Action, to advocate for financial reform legislation.

RED BANK — People can't afford a repeat of the economic catastrophe that ripped through the financial sector 18 months ago, a congressman said Monday.

U.S. Rep. Frank J. Pallone Jr., D-N.J., and local business leaders pushed for the Senate to follow the House and pass the Wall Street Reform and Consumer Protection Act.

"There's always the danger of sliding back," said Pallone, outside the Broadway Diner. "We want to make sure we've placed reforms or restrictions or regulations, if you will, on the financial sector so we don't have a repeat of what happened a year and a half ago."

The Senate is debating a transformation of the rules that govern the financial sector. The House has already passed its own version.

It would create an early warning system to flag signs of a crisis in the financial system, create a method to liquidate large failing firms and write regulations for complex securities, such as derivatives, backers say. It also would create a new consumer protection agency.

One issue is to make sure these securities are understood by investors, Pallone said.

"The biggest concern, I think, is that unless you are dealing with stocks and bonds, you are not necessarily aware of what you are trading in," Pallone said. "You are not necessarily aware of how your money's being spent."

The way to make a recovery meaningful is to create more jobs in small businesses. "It's Main Street over Wall Street," Pallone said.

There are no tools available to help small business owners, said Nancy Adams, executive director of Red Bank RiverCenter.

"What is really needed is tools for the small business, the retailer, to be able to help themselves survive and get through this," Adams said. Banks, which have gotten help from the federal government, have not increased their lending to small business owners, she added.

Retailers still feel uneasy. "We are increasing foot traffic and we are getting people into town, but they're not carrying the shopping bags the way they used to," Adams said.

Leslie Schlesinger, New Jersey Citizen Action's Community Reinvestment Act organizer, said Wall Street firms are fighting the bill, trying to weaken it with amendments. "Wall Street has such a vested interest," she said.

Final debates on amendments are going on in the Senate, she said. "This is our chance finally to get financial reform done."

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