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Senate Passes Financial Reform Legislation, Biggest Since Great Depression

House Financial Services Chairman Barney Frank and Senate Banking Chairman Chris Dodd i i

The financial legislation is named after Senate Banking Chairman Christopher Dodd (right) and House Financial Services Chairman Barney Frank, seen outside the White House on May 21. Susan Walsh/AP hide caption

itoggle caption Susan Walsh/AP
House Financial Services Chairman Barney Frank and Senate Banking Chairman Chris Dodd

The financial legislation is named after Senate Banking Chairman Christopher Dodd (right) and House Financial Services Chairman Barney Frank, seen outside the White House on May 21.

Susan Walsh/AP

Lawmakers on Capitol Hill have passed sweeping financial industry regulations, 60 to 39, handing another legislative victory to President Barack Obama, NPR's Audie Cornish reports.

It is the biggest rewrite of the financial regulatory system since the Great Depression. It is also, well, big. It is 2,300 pages.

According to Senate Majority Leader Harry Reid, the legislation is aimed at preventing taxpayer-funded rescue of the financial industry in the future.

"First, we're saying to those who gamed the system, the game is over," he said. "We're cracking down on those who gamble away what so many have worked so hard to put away."

Under the provisions, regulators would form a council with the power to impose extra restrictions on giant financial firms as well as banks. It could also direct the FDIC to dissolve a financial company threatening the entire system with its failure. Lastly, it seeks to add an all-new regulator, housed under the Federal Reserve, focused on consumer loans — from creidit cards to mortgages.

According to Senate Minority Leader Mitch McConnell, Republicans fundamentally disagree with the approach:

"It creates a vast new and unaccountable bureaucracy that, if past experience is any guide, will lead to countless burdensome, unintended consequences for individuals and small businesses," he said.

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