House OKs bill to ease banking rules
- Author: Zachary Reyes Jun 14, 2017,
Jun 14, 2017, 8:54
The House today passed the Financial Choice Act by a mostly party line vote of 233 to 186 (one Republican, Rep. Walter Jones of North Carolina, voted against). "We will replace economic stagnation with a growing healthy economy". "This law may have had good intentions but its consequences have been dire for Main Street".
"Singling out a few large insurance companies for redundant regulation harms competition, leads to higher prices and less financial protection for consumers, and fails to make the financial system safer", Kandarian said. These powers allowed the nation's watchdogs to wind down failing institutions, and allow banks to be exempted from many existing financial rules if they agree to significantly increase the amount of capital they hold.
Trump started his attack on Dodd-Frank soon after taking office, ordering a Treasury Department review of the complex rules that have put the legislation into practice. The Choice Act also focuses on ending "too big to fail" by replacing DFA's Orderly Liquidation Authority with a new Bankruptcy Code created to accommodate the failure of a large, complex financial institution. He said the bill will end what he called bank bailouts.
Republicans who voted for the bill said it would open the door to more capital for small community banks.
They were created to prevent financial institutions from acting in an irresponsible manner and prevent another global economic crash.
The bill, introduced by Rep. Jeb Hensarling, R-Texas, offers the country's almost 6,000 banks a choice: If they want to avoid numerous regulatory burdens imposed during the Obama administration, they must significantly increase their emergency financial cushion.
Reform of Dodd-Frank now moves to the United States Senate.
"The House should easily clear the nearly 600-page package, but its fate is already sealed as the Senate is expected to focus on crafting its own package of reforms that can clear a 60-vote threshold", Boltansky said.
Democrats acknowledge problems with Dodd-Frank but are not supportive of Hensarling's legislation, which despite its passage in the House, has little hope of being taken up in the Senate. "The American people deserve a prosperous economy that provides them, not Wall Street, with the opportunity to thrive". The FDIC and the Fed are the two regulators responsible for overseeing this requirement under the 2010 law.
The bill will go on to the Senate, where the Republicans will have to scrounge together the votes of at least eight Democrats - or make more moderate changes to the legislation - in order for it to pass.