Congress’ effort to reform the financial regulatory system after the economy collapsed in 2008 was based on a false premise that regulatory laws weren’t strong enough already, former New York Governor Eliot Spitzer said in a speech yesterday. Regulators had power, he said, but “they just failed.”
Regulators learned a lesson after the downturn, Spitzer said, but he compared it to a driver getting a speeding ticket behavior might change for a short time before reverting back to the old way of doing things. Asked why regulators fail to take action, he said that it can be hard to stand up to powerful institutions. “The status quo is the most powerful force,” he said.
