Lauren Oppenheimer and Jim Kessler – Third Way: “Four years after its passage, Dodd-Frank remains one of the most important yet least understood laws passed in recent decades. It was designed to reduce the frequency and severity of future financial crises. It sought to overhaul the regulatory structure of Wall Street and the banking industry—from the issuing of simple mortgages for prospective homeowners to protecting consumers who use financial products to the trading of bewildering derivatives between institutional behemoth.  But like many things having to do with the financial sector, Dodd-Frank is replete with complex terminology and opaque concepts—and we have yet to see a short and simple primer that makes the law accessible. This complexity is not just an obstacle to understanding Dodd-Frank and explaining it to voters who are skeptical of both Wall Street and Congress, but an impediment to appreciating it. Dodd-Frank attempts to strike a balance between preventing dangerous behavior in finance without discouraging the wide range of financial activities and products that fuel economic growth. Think of financial markets as highways that connect borrowers and savers. When the highway system functions poorly, it affects everyone on the road. If lanes are clogged, business cannot access capital to create jobs and economic growth; consumers can’t find the on-ramp to get mortgages, auto loans, or student loans; and investors have trouble saving for the future. Dodd-Frank aims to keep the highways safe and the traffic flowing by providing speed limits, traffic signs, road maps, safety standards, vehicle inspections, and strict laws against reckless driving—in addition to a vigilant highway patrol to enforce the rules. Overly restrictive rules can make highways work sub-optimally. If highways are designed to handle traffic going 65 MPH, a 25 MPH speed limit will clog the road. A speed limit of 80 MPH would be right for some vehicles, but not trucks carrying hazardous materials. Ultimately, we want rules to handle all types of investment vehicles safely and efficiently, because the big trucks and the smaller cars share the same road. And we don’t want to create rules that permit or tempt those carrying hazardous materials to seek a less tightly regulated road or vehicle to move its product. Making these traffic rules work for each without jeopardizing others is an immensely complicated task that Dodd-Frank tries to accomplish. This memo seeks to demystify Dodd-Frank. To do so, we identify and describe the 12 most significant reforms put in place by Dodd-Frank and show how, if properly implemented, they make the financial infrastructure more resilient. We also note where critics believe the law goes too far or not far enough in making the infrastructure safe and navigable.”