Banks resisted capital requirements that would restore consequential responsibility for losses

Evidence

Another part of Dodd-Frank requires large investment banks to hold sufficient capital to cover their losses. This forces banks rather than taxpayers to pay for their mistakes. Having the wrongdoer pay restores consequential responsibility for fraudulent financial practices. Investment bankers oppose higher capital requirements on the grounds that it will diminish their competitiveness. This justification received a sympathetic hearing from congressional supporters of the financiers. — Albert Bandura, Moral Disengagement, 1563 (#expands, via linked claim)

Categorization

• XREF: connects to: Expert consensus reports codify what banks can get away with rather than genuine reform — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 539; Higher capital requirements bind nothing when capital quality is unregulated — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 539; Bankers escaped 2008 accountability because society depended on their payment systems — Yanis Varoufakis, Technofeudalism: What Killed Capitalism, 224 (+1 more)

Broader Connections

• Capital requirements shift loss burden from taxpayers back to banks. #expands (0.92) — Albert Bandura, Moral Disengagement, 1563