Michael Bloomberg’s regulatory plan comes as Democratic rivals sharpen their attacks on him.
Photo: douglas strickland/ReutersWASHINGTON—Presidential candidate Michael Bloomberg unveiled a raft of proposals to strengthen oversight of lenders, protect consumers and make college more affordable, a move that positions the billionaire former New York City mayor closer to the rest of the Democratic field on financial policy.
The nine-page plan, announced on Tuesday, would toughen tests intended to determine whether banks can withstand an economic downturn. It would reverse steps to ease trading restrictions known as the Volcker rule and impose a tax on financial transactions, an idea that has been embraced by other Democrats.
Another plank would merge mortgage-finance giants Fannie Mae and Freddie Mac into a single, fully government-owned entity over time, scrapping Trump administration plans to privatize both entities, which have been under government control since the 2008 financial crisis.
The plan represents an effort by Mr. Bloomberg, a former bond trader who founded the financial data and news company that bears his name, to distance himself from his Wall Street roots and portray himself as a champion of students, minorities, and other groups that make up the grass roots of the Democratic Party.
The plan calls for toughening the 2010 Dodd-Frank financial overhaul, some of which he previously described as “stupid.” He also has said that federal restrictions against discriminatory lending practices known as redlining triggered the financial crisis, a position at odds with a blue-ribbon commission that assessed the causes of the crash.
“It certainly goes in the opposite direction from the extreme deregulation we’ve seen under Trump,” said Marcus Stanley, policy director at Americans for Financial Reform, a nonprofit organization that advocates tougher financial regulation. “But it also goes in the opposite direction from the views [Mr. Bloomberg] has personally expressed over the years, so there’s a concern about credibility.”
Tuesday’s plan comes as Democratic presidential candidates sharpen their criticism of Mr. Bloomberg, saying he would fail to mobilize the party in a potential matchup against President Trump in November.
Mr. Bloomberg qualified for Wednesday’s Democratic presidential primary debate in Las Vegas, where he will share the stage with the rest of the candidates, including Vermont Sen. Bernie Sanders, for the first time.
Mr. Sanders, a self-described democratic socialist, said at a Saturday night dinner in Las Vegas that Mr. Bloomberg’s past views on law enforcement and economic issues would hinder the party’s chances of defeating the president. Mr. Sanders is seeking to build on his early-state success with a victory in this week’s Nevada caucuses.
The Bloomberg plan announced Tuesday would seek to revive a range of Obama-era oversight measures aimed at the financial-services industry, including tough restrictions on so-called payday lenders gutted by the Trump administration and retirement-advice restrictions for brokers overturned by a federal court. It would phase-in a new tax of 0.1% on all financial transactions, including stocks, bonds and payments on financial instruments known as derivatives—a bid to defray the costs of overseeing financial markets and to “help address inequality,” the plan said.
Mr. Bloomberg also called for making community college tuition-free for all students, and he called for substantially boosting Pell Grant funding—a federal program designed to help low-income students cover college costs—so that those students could attend four-year colleges without going into debt.
And Mr. Bloomberg would revamp how much Americans pay toward their federal student-loan debt. He would automatically enroll all undergraduate borrowers into plans that tie monthly payments to their incomes. Specifically, borrowers would pay 5% of their discretionary income, as determined by a formula, toward any undergraduate debt. After 20 years, any balance would be forgiven. For those from households earning less than $250,000, the forgiven amount wouldn’t be taxed. For those earning more, the forgiven amount would be taxed as ordinary income.
The campaign said the higher-ed proposals would cost $700 billion over a decade, compared with existing law.
—Josh Mitchell contributed to this article.
Write to Andrew Ackerman at andrew.ackerman@wsj.com and Tarini Parti at Tarini.Parti@wsj.com
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