Posted on 06/11/2017 11:56:31 AM PDT by Tolerance Sucks Rocks
House Republicans voted Thursday to replace the 2010 Dodd-Frank law with their own sweeping financial regulatory measure, the Financial Choice Act.
The bill passed 233-186, with no Democratic support. One Republican, Walter Jones of North Carolina, voted no.
Authored by Rep. Jeb Hensarling of Texas, the conservative chairman of the House Financial Services Committee, the bill is perhaps second only to the healthcare legislation Republicans passed last month in its scope and significance. Like the healthcare bill, it would undo one of Obama's top legislative achievements, the new rules imposed on the financial sector in the wake of the 2008 financial crisis. Republicans justify the bill on the grounds that the regulations are holding down economic growth.
Previous acknowledgment that the bill could not survive a Democratic filibuster in the Senate muted some of the fanfare and controversy that otherwise would have accompanied its passage. The highly anticipated testimony from FBI Director James Comey on Thursday morning also overshadowed the vote.
Nevertheless, Hensarling said he hopes to negotiate with Senate Democrats on the measure and has expressed interest in moving specific pieces of it through the Senate and to President Trump's desk.
"Let's get this done for the people who take the risks, who live and breathe their work," House Speaker Paul Ryan said on the House floor.
A main feature of the legislation would be an offer to banks: If they maintain a significantly higher level of capital, they would receive additional regulatory relief — the choice for which the bill is named. Higher capital means less indebtedness and more funding through ownership stakes. The idea is that requiring higher capital would reduce the likelihood of a bank collapsing and also institute more market discipline because owners have more skin in the game.
No banks that had the levels of capital required by the bill failed during the crisis, noted Rep. Paul Mitchell, a Michigan freshman. For 18 months during the crisis, Mitchell recounted in explaining his support for the legislation, the career training business of which he was CEO didn't know if the megabank it relied on to make payroll would go bust, taking his company with it.
Aside from that provision, the bill would limit the new powers granted to regulators, eliminate the "Volcker Rule" preventing banks from speculating with deposits insured by the federal government, and dramatically scale back the role of the Consumer Financial Protection Bureau.
House Democrats expressed confidence Thursday that their counterparts in the Senate would block the Choice Act. Nevertheless, House Minority Leader Nancy Pelosi expressed concern that parts of the bill could pass separately. "The cumulative effect on the investor, on the taxpayer, on the consumer, will be the same, and it's not good," she said.
In recent weeks, Democrats have made sure to call the bill the "wrong choice act." They accused Republicans of trying to cut regulations to benefit banks, at the risk of allowing another crisis.
"This bill is a festival of bad choices, of wrong choices for America," Rep. Matt Cartwright, D-Pa., said on the House floor.
In the Senate, Banking Committee Chairman Mike Crapo has charted a different course. Rather than seeking to advance Republican legislation, he is working toward bipartisan compromises.
The Trump administration has waited to produce reports requested by President Trump before staking out policy preferences on financial reform. Nevertheless, the White House on Wednesday said that it supported House passage of the Choice Act in advancing the cause of regulatory relief.
"This is a huge part of regulatory reform," said Rep. Keith Rothfus, R-Pa., a member of the Financial Services Committee. "We had this paradigm over the last eight years that said Washington knew best about everything, and they could micromanage everything from what's in your health insurance plan, to what kind of mortgage or who's getting a mortgage, to what kind of energy you can have."
In general, financial industry groups supported the measure, or at least its advancement in the House, despite skepticism of some measures. In particular, some larger bank groups did not favor the changes that would be made to the Federal Reserve's monetary policy communications, as well as the high capital requirements, which outside analyses suggest would not benefit big banks.
"The House has taken the lead in efforts to modernize the financial regulatory system to advance the goal of boosting the economy without sacrificing important consumer and taxpayer protections," said Tim Pawlenty, head of the Financial Services Roundtable. "We look forward to working with Congress to get many of the provisions in the CHOICE Act to the President's desk."
Good news!
PING!
A lot going on while the media focuses on Russia and impeachment’
Now repeal Sarbaines-Oxley.
It has generated hundreds of billions of dollars of useless reports. SOX would NOT have stopped Enron from happening.
I know KPMG, Anderson-Coopers and Deloitte love it since they can bill to kingdom come and not actually have to PRODUCE anything but Gigabytes of fluff.
I have worked in consulting for nearly the last 20 years, during the time SOX was passed. Trust me, it accomplishes nothing and I could do a SOX audit myself and I am not even a CPA.
The Financial CHOICE Act of Jeb Hensarling is a BIG DEAL.
It is an off-ramp from Dodd-Frank for local and regional banks by increasing their capital.
This is to free them from crushing regulatory burdens and unjust restrictions against their making money available to people they may have known for years . . . decades.
ANYONE who OPPOSES this is in the pocket of the too-big-to-fail banks.
The only sad part about all of this WINNING is that whatever good we do is going to also benefit the TRAITORS and malcontents among us.
Changing hearts and minds of members of the Socialist Democrat Party? Seems unlikely. Of course, they’ll take advantage of all the perks.
*SPIT*
President Trump is destroying the Marxist’s plan to ruin our Capitalist system. Americans are waking up to the fact that the Democrats are just another spoils system to benefit an elite class.
And if the bank loses those deposits?
Yes, I find that one troubling also. Derivatives!
Yes, it is good news. But will it also be passed by the Senate? If not, then it is no news at all.
If the Senate simply repealed the two-track rule for filibusters, then it would be much more difficult for Democrats to block the agenda. They might try anyway, but I don’t know how much political benefit they will get from shutting down the entire Senate for an old-school filibuster every time something comes from the House.
“A lot going on while the media focuses on Russia and impeachment...”
And that’s SO DELICIOUS, isn’t it? ;) WINNING! MAGA!
“ANYONE who OPPOSES this is in the pocket of the too-big-to-fail banks.”
IOW - your everyday RINO (So SURPRISED at Ryan backing this, actually!) and all members of the Socialist Democrat Party.
RINO Ryan may just be blowin’ smoke up my skirt - I’m excited, but I’ll wait to see what the Senate does this coming week. As usual, the FIX may already be in...
Currently, small community based banks are required to follow the same capital management, reporting rules and auditory requirements that the big five banks in this country are required to follow.
There are vast differences between a $100,000,000 capitalized local community bank and Chase/Bank of America/Wells Fargo/CitiBank/BNY Mellon specific to how they manage their capital and the risks that each faces.
The economic disparity between small community banks and the Big Five further widens when one accounts for the excessive regulatory compliance costs that small banks must incur to stay in business compared to the Big Five. This places small community based banks at a severe competitive disadvantage and dramatically reduces the amount of capital they have to lend to small business owners as a result.
Local community banks have a deep history of knowing their customers very well and managing their risk portfolio's. They also have a history of WORKING with their customers when they find themselves in trouble to manage that risk effectively and recover losses while maintaining good relationships with those same customers.
The top five banks (above) have a long history of frankly SCREWING their customers and us, the taxpayers of this country through legislation that favors them ("too big to fail" and the banking bailouts) at the expense of smaller, community based banks.
This is a topic I could write a book on (seriously!) and I work for one of the top 10 banks in the country.
Still, I firmly support a return to Community Based Banking and an elimination of Dodd-Frank specifically to re-enable community based banking which btw created the biggest expansion of our economy during the Reagan years and through the Reagan economic expansion that lasted through the Clinton years and into the Bush years.
Bring Back Community Based Banking! Break-Up The Big Five!
EXCELLENT SERIES ON MONEY by Mike Maloney!
If you don’t have time to watch it all now, please bookmark it! Unless, of course, you are easily frightened by DISTURBING FACTS about the BIGGEST SCAM in human history! I must say, their plan is BRILLIANT as economics and finance make most peoples’ heads hurt!
Quick tease for any timid doubters: Mayer Amschel Rothschild, the founder of the European Rothschild banking family, once declared “Let me issue and control a nation’s money and I care not who writes the laws.”
Some of his descendants arrived in America in the very late 1800s. We got the FEDERAL RESERVE — and the INCOME TAX — in 1913.
https://www.youtube.com/watch?v=DyV0OfU3-FU&list=PLE88E9ICdipidHkTehs1VbFzgwrq1jkUJ
I work for one of the top 10 banks in the world -— your post is SPOT ON. I’ve seen first hand the impacts of SARBOX and the money WASTED on consultants who add no value whatsoever.
Eliminating the Volker rule would mean Banks can no longer speculate with their customers deposits.
That would be a good thing.
OK, a question, does this mean that I can’t buy a 1.3M house in Silicon Valley on my 35K year salary? s/
How so? They are eliminating it.
Definition: The Volcker Rule prohibits banks from using your deposits to trade for their profit. It forbids them from owning, investing in, or sponsoring hedge funds, private equity funds, or any proprietary trading operations for their use. It prevents them from using funds guaranteed by the Federal Deposit Insurance Corporation for these hedge funds and private equity funds.
Frank just choked on a frank, he he he he he he heh
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