By Sheila Pursglove
Legal NewsThe fictional Gordon Gekko and his Wall Street cronies would hate University of Michigan law professor Michael S. Barr.
But anyone who has a bank account, credit card, mortgage, or investments, or who owns a small business, would applaud him. Not to mention the millions of Americans who will benefit from a safer financial system in the future.
Barr, who teaches Financial Institutions, International Finance, Transnational Law, and Jurisdiction and Choice of Law, was on leave 2009-2010, serving as the U.S. Department of the Treasury Assistant Secretary for Financial Institutions.
He was a key architect of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, reforming regulation of major Wall Street firms, derivatives markets, credit rating agencies, securitization markets, mortgage markets, international remittances, improving investor and consumer protection, providing for financial access initiatives, and other measures.
Barr points out that among the key reforms, “the Dodd-Frank Act creates a new Consumer Financial Protection Bureau that will look out for the interests of American households, with clear rules of the road for credit cards, mortgages and other financial products and services.”
The Washington, D.C. native previously served as a senior fellow at the Center for American Progress and at the Brookings Institution; as Special Assistant to Treasury Secretary Robert Rubin; as Deputy Assistant Secretary of the Treasury; as Special Advisor to President Bill Clinton; and as a special advisor and counselor on the policy planning staff at the State Department.
Barr, who also co-founded the International Transactions Clinic at U-M, conducts large-scale empirical research regarding financial services and low- and moderate-income households and researches and writes about a wide range of issues in financial regulation.
He co-edited “Building Inclusive Financial Systems and “Insufficient Funds”; other publications include “An Opt-Out Home Mortgage System,” “Behaviorally Informed Financial Services Regulation,” “Third-Party Tax Administration,” “An Inclusive Progressive National Savings and Financial Services Policy,” “Credit Where it Counts,” “Banking the Poor,” “Microfinance and Financial Development,” and “Global Administrative Law: The View from Basel.”
Barr was selected by the U-M Institute for Social Research, Survey Research Center, as Detroit Area Survey Faculty Investigator, for “Financial Services for the Poor,” and awarded more than $1 million in grants from the Ford Foundation, MacArthur Foundation, Casey Foundation, Fannie Mae Foundation, Mott
Foundation, Community Foundation for Southeastern Michigan, National Poverty Center, Center on Local, State and Urban Policy, Office of Vice President for Research, Provost’s Office, and the Law School.
He was awarded a $100,000 Ford Foundation grant on “access, assets and poverty” and a $400,000 Kellogg Foundation grant for work on behavioral finance.
As an example of problems faced by the poor, many low-income people do not have bank accounts, and are unable to overcome the barriers that discourage or prevent them from opening one, Barr says. If they succeed in opening a bank account, they may be unable to maintain them, because banks usually charge hefty fees when an account is overdrawn or the account holder does not maintain a minimum balance. And at this time of year, when many people enjoy getting tax refunds, low-income people often pay high fees to take out refund anticipation loans and pay high fees to get their refund checks cashed, Barr says.
Barr, who clerked for U.S. Supreme Court Justice David H. Souter and then-District Court Judge Pierre N. Leval, of the Southern District of New York, earned his bachelor’s degree summa cum laude with honors in history from Yale; and as a Rhodes Scholar he earned an M. Phil in International Relations from Magdalen College, Oxford University. He earned his law degree from Yale Law School.
“My father was a labor lawyer and I was drawn to the opportunity to change our laws and policies to help build a better, more inclusive country,” he says. Barr added, “Finance is central to economic growth and opportunity.”
The financial wizard finds his law students are among his best investments.
“Our students have enormous energy and tend not to be jaded about the world,” he says. “They want to work hard and at the same time they treat each other with respect and affection.
“U-M is a world leader in law, business, economics and many other fields and so provides a great place to engage in interdisciplinary research with colleagues.”
Profile in Brief: Michael S. Barr - Financial Whiz
By Sheila Pursglove