One year after the fall of Lehman Brothers' brought the global economy to the brink of collapse, questions remain as to whether the government has been tough enough on Wall Street. Experts explain why.
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Lehman Brothers had declared bankruptcy. The government had pumped tens of billions of dollars into insurance giant AIG. And the market plunged amid questions about the real value of trillions of dollars in securities.
That was the situation one chaotic week just a year ago.
REP. BARNEY FRANK, D-Mass.:
If you absolve people from the serious consequences of their own misjudgments…
A year later, various proposals continue to be put forth in Congress and elsewhere to change some Wall Street habits. Today, for example, the Federal Reserve confirmed to the NewsHour and other news organizations that it plans to place curbs on compensation policies at major banks. The rules would affect traders, mid-level and top executives, and are intended to discourage excessive risk-taking that is often tied to pay.
This afternoon, President Obama's top economic adviser, Lawrence Summers, echoed that sentiment in a speech at Georgetown University. More broadly, he called for tougher oversight of Wall Street to prevent the need for future bailouts.
LARRY SUMMERS, White House economic adviser: It is wrong that taxpayers, thousands of miles from Wall Street, should be at risk because our system gives authorities no choice but to commit taxpayer money or to accept collapse and chaos.
For its part, Congress may take up legislation later this fall.
And more on Wall Street and regulation now from Lynn Stout, professor of corporate and securities law at UCLA.
Robert Glauber, lecturer in public policy at Harvard's Kennedy School of Government and former CEO of the National Association of Securities Dealers, he served in the Treasury Department under the first President Bush.
And Gretchen Morgenson, assistant business and financial editor and a columnist at the New York Times.