Americans are less divided on key issues than a lot of pundits would have you think. On the question of overseeing big banks and the financial system, Americans show none of the divisions Washington lawmakers do.
Ten years after the 2008 financial crisis, American voters, across party lines and other demographics, still support tougher regulation of Wall Street. I have surveyed public opinion now for 6 years and have been struck repeatedly how this issue simply will not fade, even with President Trump openly badmouthing the Dodd-Frank law passed after the crisis. Even as regulators seem eager to tear down the reforms of the last decade, Americans of all stripes support the Dodd-Frank law, and want more, not less enforcement of the rules on the financial services industry.
Their core convictions about fair play, and mistrust of concentrated financial power underpin their views, held with an intensity that pollsters rarely observe, probably owing to the searing experience of the financial crisis and subsequent recession. We should not be surprised that candidates are picking up the issue as we approach the most fateful midterm elections in decades.
Each year I am part of a bipartisan team that surveys American attitudes towards financial regulation on behalf of Americans for Financial Reform and the Center for Responsible Lending. We pose tough questions that test whether voters are more skeptical of government than the financial services industry. Overall, 59 percent of voters favor stronger regulation of it, with majorities in all parties.
Likewise, the mission of the Consumer Financial Protection Bureau enjoys more support from Republican voters (50 percent) than it does from Republican lawmakers, who have repeatedly sought to gut the agency. Even when we inject the volatile issue of race into the equation, asking whether the CFPB should fight racial discrimination in lending, majorities support action.
Our qualitative and quantitative research among American voters in the last decade lets us theorize as to why support for Wall Street reform has remained strong. Unquestionably, the harrowing experience of the recession – homes foreclosed, jobs lost, savings wiped out – left deep scars, the sort of things people will remember for the rest of their lives as they struggle to buy a new home, establish a new career, or have a nest egg for retirement.
The harrowing impacts of the crisis and recession were universal. Though the effects came first, and worst, for communities of color and lower income brackets, everyone felt the impact, from blue-collar workers to the highly educated. Many women voters especially feel the recession turned the U.S. economy into a permanently unpredictable beast, offering little of the stability or security they had before the crisis.
In short, American voters’ attitudes toward financial regulation may revolve as much around their values as it does around the actual policy. They are probably fairly flexible about what actual policies come into play. But the core value that the financial system should work for everyone, not only the Wall Street barons who crashed the economy 10 years ago, speaks to them on a deep level.
Candidates in 2018 are have absorbed that lesson and are finding ways to talk about these values through the idiom of financial regulation. A crop of Democratic contenders in places like California, Kentucky, and Indiana are touting their support for Wall Street reform.
There will probably be more candidates talking up the issue before voters go to the polls in November. Aspiring members of Congress know that, even 10 years after the financial crisis, they can speak to the zeitgeist by supporting Wall Street reform, both what has been done and what should be done. This issue will not go away, but lawmakers who get on the wrong side of public opinion might.
Robert Carpenter founded Chesapeake Beach Consulting and has advised many Republican candidates.
