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Setting the Legislative Agenda
The Congressional Oversight Panel identified eight specific areas most urgently in need of reform and addressed each with recommendations:
- Identify and regulate financial institutions that pose systemic risk.
- Limit excessive leverage in American financial institutions.
- Increase supervision of the shadow financial system.
- Create a new system for federal and state regulation of mortgages and other consumer credit products.
- Create executive pay structures that discourage excessive risk taking.
- Reform the credit rating system.
- Make establishing a global financial regulatory floor a U.S. diplomatic priority.
- Plan for the next crisis.
“Americans have paid dearly for this latest crisis,” the report concluded. “Lost jobs, failed businesses, foreclosed homes, and sharply cut retirement savings have touched people all across the country. Now every citizen — even the most prudent — is called on to assume trillions of dollars in liabilities spent to try to repair a broken system. The costs of regulatory failure and the urgency of regulatory reform could not be clearer.”
