President Obama on Wednesday signed into law a massive bill that will provide new regulation for a broad swath of the nation's financial system -- legislation he said provides "the strongest consumer protections in history."
The new law, he said, will bring transparency to risky, complex transactions like those that helped trigger the financial crisis and will put an end to the notion that some companies are "too big to fail."
"Because of this law, the American people will never again be asked to foot the bill for Wall Street's mistakes. There will be no more taxpayer-funded bailouts," Obama said.
The law, pushed through mainly by Democrats in Washington's deeply partisan environment, comes almost two years after the infamous near financial meltdown in 2008 in the United States that was felt around the globe.
It gives the government new powers to break up companies involved in practices threaten the economy, puts more light on the financial markets that escaped the oversight of regulators and -- one of Obama's biggest victories -- creates a new consumer financial protection bureau.
The agency will be housed in the Federal Reserve but will be virtually independent. Banks fought hard against its creation, and they fear that the president may appoint Elizabeth Warren, chairwoman of the Congressional Oversight Panel and a staunch consumer activist, as its first director.
Obama described the changes as common sense reforms that will help people in their daily life -- signing contracts, understanding fees, understanding risks.
Much of the detail is yet to be written by financial regulators, and critics still aren't convinced that the law will be effective.
Republicans portray the bill as a burden on small banks and the businesses that rely on them, and argue that it will cost consumers and impede job growth. Rep. Darrell Issa of California called Obama's bill-signing a "charade" that ignored the root causes of the financial crisis.
The president said otherwise. He argued that a crippling recession was primarily caused by a breakdown in the financial system that cannot be allowed to happen again. "I proposed a set of reforms to empower consumers and investors, to bring the shadowy deals that caused this crisis into the light of day, and to put a stop to taxpayer bailouts once and for all," Obama said to supporters. "Today, thanks to a lot of people in this room, those reforms will become the law of the land."
In a note of irony, Obama signed the bill with great fanfare in the massive Ronald Reagan Building, named after a president who championed deregulation. The president was joined by scores of consumer advocates, state and local government officials, business owners and executives, and members of Congress who supported the bill. Obama singled out for praise Sen. Chris Dodd (D-CT) and Rep. Barney Frank (D-MA), who shepherded the bill through Congress.
In the midst of a heated midterm election season for many lawmakers, Obama sought to put the complex law in consumer-oriented terms for the nation. He said it would help root out fine print and hidden fees for people, and provide deeper scrutiny of the sophisticated financial transactions on Wall Street.
NPR's John Ydstie contributed to this report.
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