Politics & Government

Potosnak Holds News Conference on Financial Reform

The Democratic candidate for New Jersey's Seventh Congressional District delivers an address on financial reform Wednesday.

Ed Potosnak, Democratic candidate for New Jersey's Seventh Congressional District, hosted a news conference in front of a foreclosed home in Scotch Plains on Wednesday afternoon. Potosnak, who is challenging one-term Republican incumbent Leonard Lance, delivered a seven-minute address on financial reform, then took questions.

A vacant two-story residence at 2409 Park Place, its front lawn overgrown, formed the backdrop for Potosnak's conference. The candidate called the house "a potent example and symbol of the economic crisis."

Speaking exactly two years after the collapse of Lehman Brothers, widely regarded as the start of the economic recession, Potosnak lauded the financial reform overhaul that Congress passed in July. He asserted that it will shield borrowers from predatory lenders, reduce foreclosures and prevent taxpayer-funded bailouts of banks.

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"Congress acted…to make our markets more transparent, to provide oversight to risky investment practices, and importantly, to protect American investors," Potosnak said.

He criticized Lance for voting against the reform bill, alleging that the Congressman was swayed by campaign contributions. Lance sits on the House Financial Services Committee.

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"His duty as a member of that committee is to regulate the banking and financial industry," Potosnak said. "Isn't it a conflict of interest when a majority of your campaign contributions come from the very same people that you're charged with regulating?"

Of the $997,128 Lance has raised for his 2010 campaign, at least $279,404 – or 29 percent – has come from securities and investment, commercial banking, finance and credit companies, according to OpenSecrets.org, which tracks political contributions and spending.

Potosnak pledged that, if elected, he would uphold and seek to strengthen the financial reforms enacted this summer. "I'll vote against any attempt to dismantle or weaken these financial measures," he said. "I'll fight to make sure we make other reforms to protect investors."

He called for stricter regulation of risky investment practices, such as credit default swaps, and banning others that "add absolutely no value to our financial market and allow people to get rich by betting on the failures of others."

Potosnak praised the creation of the Consumer Financial Protection Bureau (CFPD), which was mandated by July's financial reform bill. During the question-and-answer session that followed his address, Potosnak said that he would support Elizabeth Warren as the head of the new regulatory agency. On Thursday night, news agencies reported that President Barack Obama would name Warren, a Harvard law professor, to the Treasury Department as an adviser to lead the CFPD's creation.

"Warren would be a good fit," Potosnak said.

When asked how he would reinvigorate small business, he offered a position similar to Lance's: he would seek to free-up capital for small businesses – "to make sure they have the capital to help them make their dreams a reality" – and a 100 percent write-off for small businesses' capital investments.

His opinion on extending the Bush-era tax cuts, however, diverged from Lance's. "I'm very concerned about the extension of the Bush tax cuts," Potosnak said, adding that he supports a tax cut for the middle class.


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