President Obama congratulates Sen. Chris Dodd, center, and Rep. Barney Frank, after he signed the Dodd-Frank Wall Street Reform and Consumer Protection financial reform bill at the Ronald Reagan Building Wednesday. Obama signs Wall Street reform bill

Almost two years after the near collapse of the American economy, President Barack Obama signed into law on Wednesday a historic rewriting of the regulations governing the nation’s financial system and declared the end of an era of antiquated rules that left Americans vulnerable.

Describing it as a triumph for consumers and a necessity for business, the president hailed the law, saying that the financial system “only works — our markets are only free — when there are clear rules and basic safeguards that prevent abuse, that check excess, that ensure that it is more profitable to play by the rules than to game the system.”


“And that is what these reforms are designed to achieve; no more, no less,” Obama said during the ceremony at the Ronald Reagan Building, “because that is how we will ensure that our economy works for consumers, that it works for investors, that it works for financial institutions — that it works for all of us.”

But despite his second major legislative victory since taking office, Obama is already under pressure from progressives disappointed with the bill. They want him to appoint an aggressive advocate to run the new Consumer Financial Protection Bureau.

The liberal base has rallied around Elizabeth Warren, a plain-spoken Harvard University law professor who drafted the idea of a consumer bureau. But top administration officials, sensing opposition from Republicans and the business community, have said she is only one of several candidates under consideration.

The reluctance of the White House to publicly embrace Warren has prompted some congressional Democrats and labor groups such as the Service Employees International Union to launch impromptu campaigns on her behalf.

Obama on Wednesday said the consumer bureau would be led by a “watchdog with just one job: looking out for people — not big banks, not lenders, not investment houses — in the financial system.”

Obama signed the bill after months of debate that led to hopes of producing a strong bipartisan measure, but it barely passed the Senate with a handful of Republican votes. The GOP and the business community argued that the bill failed to address what they said was the root cause of the 2008 financial crisis — irresponsible lending at mortgage giants Fannie Mae and Freddie Mac — and that the reforms would lead financial firms to move jobs overseas.

The bill “epitomizes a law with unintended consequences” that will hamstring American businesses, said Tom Donohue, president and CEO of the U.S. Chamber of Commerce. Though the Chamber is open to financial system modernization, he added, “this law is like adding new paint on an old car; it’s still not going to run at the pace and with the agility that is currently demanded.”

Obama took on the criticism from Wall Street, saying the reform will help foster innovation, not hamper it.

“It is designed to make sure that everyone follows the same set of rules, so that firms compete on price and quality, not tricks and traps. It demands accountability and responsibility from everyone,” Obama said. “It provides certainty to everybody from bankers to farmers to business owners. And unless your business model depends on cutting corners or bilking your customers, you have nothing to fear from this reform.”

He signed the bill flanked by Senate Banking Committee Chairman Chris Dodd (D-Conn.), House Financial Services Committee Chairman Barney Frank (D-Mass.) and Senate Agriculture Committee Chairwoman Blanche Lincoln (D-Ark.) and congressional leaders. Obama went out of his way to praise them for shuttling the bill through Congress; Dodd and Frank received an extended standing ovation.

“Barney and Chris have worked day and night to bring about this reform, and I am profoundly grateful to them,” Obama said before thanking Senate Majority Leader Harry Reid and House Speaker Nancy Pelosi “for their leadership.”

He added that he “couldn’t have done it” without Lincoln.