Drafting the Dodd-Frank Narrative

George Bailey is making a vicious comeback.

The release of a working paper from the Harvard Kennedy School concluded that the declining strength of community banks has accelerated since the passage of Dodd-Frank in 2010. While the authors admit that the decline in community banks – with their share of U.S. banking assets falling to 20 percent – is not solely attributable to Dodd-Frank, they express concern that the trouble may stem from “inappropriately designed regulation and inadequate regulatory coordination.”

Regardless of my opinion on the central regulatory reform, this news struck a particular chord. As a communications professional, I’m always mindful to digest the news with a literary lens. All lasting news has an arc and a storyline, and this may be an inflection point for Dodd-Frank.

As it stands, the reform bears a troublesome narrative. The Act’s reputation is always in flux due to the political process that defines its implementation. It also faces constant heat from the financial industry. In other words, Dodd-Frank appears to be in its teenage years – awkward, anti-authoritarian, and unsure what it wants to be when it grows up.

Clarifying the narrative of Wall Street reform is a difficult task given the variety of moving parts involved. However, our brains are attracted to narratives – telling stories is how companies sell products and craft compelling brand identities. For parties with a stake in shaping the Act’s outcome and legacy, narrative should be a central concern.

The nature of the Dodd-Frank narrative will depend on the perspective – whether it’s Elizabeth Warren or the Bloomberg editorial team speaking. But by localizing the impact to the strength of community banks, I argue, the narrative opportunity is stronger than ever.

At the end of the day, everyone wants a more stable economy. With such an influential piece of legislation in play, let’s just hope that the players with the strongest solutions have the same persuasive powers as George Bailey warding off a run on the bank.

Photo courtesy of Janaka Dharmasena/

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