President Barack Obama on Saturday applauded House passage of an ambitious restructuring of federal financial regulations designed to correct failures that led to the economic meltdown.
He called for quick action by the Senate "because we should never again find ourselves in the position in which our only choices are bailing out banks or letting our economy collapse."
The bill would grant the government new powers to split up companies that threaten the economy, create a new agency to oversee consumer banking transactions and shine a light into shadow financial markets that have escaped federal oversight.
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The House approved the bill 223-202 Friday. No Republicans voted for the bill, and 27 Democrats voted against it. Opponents argue that the broad legislation overreaches and would institutionalize bailouts for the financial industry.
The Senate Banking Committee is working on its own version of the package.
In his weekly radio and Internet address, Obama laid much of the blame for the tailspin the economy is now beginning to recover from on the "irresponsibility" of Wall Street institutions that "gambled on risky loans and complex financial products" in pursuit of short-term profits and big bonuses with little regard for long-term consequences.
"It was, as some have put it, risk management without the management," he said.
It was the worst economic downturn since the Great Depression, a "disaster," Obama said, that in the past two years put some 7 million people out of work. It wouldn't have happened, he said, had the rules governing Wall Street been clearer and enforcement tougher.
Obama singled out Republicans and industry lobbyists for trying to block the changes.
Last week, top House Republicans urged more than 100 financial industry lobbyists to work harder to defeat the bill. Lobbyists have spent more than $300 million this year trying to scuttle the bill.
Opponents say that the changes would limit consumer choice and that added federal oversight would stunt financial market innovation.
Obama suggested that was one risk worth taking.
"Americans don't choose to be victimized by mysterious fees, changing terms and pages and pages of fine print. And while innovation should be encouraged, risky schemes that threaten our entire economy should not," he said. "We can't afford to let the same phony arguments and bad habits of Washington kill financial reform and leave American consumers and our economy vulnerable to another meltdown."
Obama has scheduled a meeting Monday at the White House with financial services industry leaders to seek support for his effort to tighten federal oversight of the industry and to limit pay for top executives at institutions that accepted billions in bailout money from the government.
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