Why Trump, the ‘King of Debt,’ Hates Dodd-Frank
Contrary to popular belief, the 2010 law actually did abolish ‘too big to fail.’By Alan S. Blinder, WSJ
June 6, 2016 7:07 p.m. ET
Populism—standing up for the little guy against the powers that be—seems to be the theme of the 2016 presidential campaign. Yet Donald Trump, a faux populist if there ever was one, said in a May 17 interview that he wants to eviscerate the Dodd-Frank Act. In his words, “it will be close to a dismantling of Dodd-Frank.” But destroying Dodd-Frank certainly would not be good for the little guy.
Dodd-Frank was the landmark legislation enacted in 2010 to, among other things, ensure that we never have a repeat of the financial catastrophe of 2008—nor of the disgraceful practices that led up to it. Lest The Donald forget, those misdeeds led to the worst recession since the 1930s, to massive layoffs, to millions of foreclosures, and perhaps worst of all, to the political disaffection that gave rise to Trumpism.
So why would an alleged populist turn on Dodd-Frank? I can think of three reasons. One is the Republican article of faith that all regulation of business is bad, period. Maybe. But Mr. Trump has been repudiating Republican orthodoxy, not to mention Republicans, left and right.
A second explanation is that Mr. Trump is cozying up to the big bankers from whom he now needs campaign contributions—contrary to his repeated promises to fund his own campaign. Well, maybe. Many bankers would certainly like to get out from under Dodd-Frank. But many others, being rational, probably prefer the known Dodd-Frank to the unpredictable Donald Trump.