WASHINGTON -- Treasury Secretary Timothy Geithner went to a conservative leaning thing tank yesterday to make the case for revamping financial regulations in a manner that provides "strong protection for consumers, strong constraints on risk taking by large institutions and strong tools to protect the economy and taxpayers from future crises."
At the same time as the Senate Banking Committee was voting out a bill to revamp financial regulation, Geithner told an audience at the American Enterprise Institute, that comprehensive reform, including a new consumer financial regulator, would provide market stability.
Geithner dismissed objections raised by some lobbyists for the financial services industry that the regulators responsible for ensuring safety and soundness should also protect consumers. He said the existing system "produced terrible failures in consumer protection."
The Treasury secretary added that having a separate regulator for consumer financial products will result in a group of government officials whose sole mission is to figure out ways to protect consumers and "make consumer markets fairer, more transparent and more competitive. "
The American Enterprise is a Washington think tank. Its scholars provided some of the intellectual justification for the Iraq war, and Geithner used military analogies when describing the importance of financial reform.
He said it is "not a war of choice; it is a war of necessity. And to use the language of theology, this is a just war."