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Presidential Issues: Finance & Banking

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Sorry Bernie, Wall Street Wasn’t Deregulated Pre-Crash

February 10, 2016

By Jared Meyer

With his New Hampshire win, Senator Bernie Sanders’ momentum continues to grow in the race for the Democratic presidential nomination. Part of Sanders’ appeal stems from his staunch opposition to all things Wall Street. In his speech on the topic from early this year, Sanders argued, “in the 1990s and later, the financial interests spent billions of dollars in lobbying and campaign contributions to force through Congress the deregulation of Wall Street.”

There is just one problem with this statement—it is not true. The touted widespread deregulation of Wall Street never happened.

In the years leading up to the financial crisis, the number of Code of Federal Regulation restrictions on the finance and insurance industry increased 11 percent, and this level increased 15 percent during George W. Bush’s presidency. In 1997, there were 23,422 restrictions on the industry, a level that increased to 26,235 by 2008. In other words, on the eve of the crash, there were over 26,000 words such as “must,” “cannot,” or “shall” that governed the conduct of finance and insurance companies.

Read the full article at Economics 21: Sorry Bernie, Wall Street Wasn’t Deregulated Pre-Crash

Issue Categories : Bernie Sanders, Finance & Banking