Republicans pass banking bill, Knight touts small business impact

Dubbed the Financial CHOICE Act and sponsored by House Financial Services Committee Chairman Jeb Hensarling, R-Texas, pundits say the legislation is nonetheless unlikely to move forward in the Senate, despite Thursday's high-profile vote.

"Today's passage of the Financial CHOICE Act is a awful decision by the House of Representatives", left-leaning think tank Economic Policy Institute said of the vote.

The legislation is a comprehensive package of rules and regulations meant to overhaul and replace what its architect, Rep. Jeb Hensarling (R-Texas), refers to as "the failed Dodd-Frank Act that has contributed to the worst economic recovery of the last 70 years". Although President Donald Trump backs the bill, it faces an uncertain future in the U.S. Senate.

"The Financial Choice Act will allow small businesses to grow by expanding vital access to capital", the congressman said. The CHOICE act takes away much of the CFPB's supervisory authority and independence, enabling the president to fire the CFPB director at will and make its budget subject to congressional oversight.

Trump and other Republicans have long complained that Dodd-Frank saddled business with burdensome regulations that stunted economic growth; Trump famously noted during the campaign that friends of his couldn't get loans, supposedly due to the minimal regulations put in place after the financial meltdown.

Republicans who voted for the bill said it would open the door to more capital for small community banks.

Financial stocks soared after the vote, which some say could push Republicans in the Senate to pursue more aggressive reform. No Democrats voted yes, and Rep. Walter Jones of North Carolina was the lone Republican "no" vote.

The bill is not expected to receive sufficient support in the Senate in its current form since Democrats have universally opposed it.

But as The New York Times reports, even Wall Street lobbyists and lawyers were pessimistic about the chances of the bill.

The legislation also repeals Dodd-Frank's Durbin amendment, which places limits on debit card processing fees, and the Volcker Rule, which bans banks from speculatively investing borrowed money in ways proven not to benefit customers, among other cuts to provisions specifically created to protect the average Jill.

Republicans argue that regulations under Dodd-Frank have throttled the banking industry and made it hard for small business and individuals to receive loans.

"The Consumer Financial Protection Bureau the law created has returned almost $12 billion worth of compensation to 29 million wronged Americans, many of them seniors, many of them service members".

Community banks "are being crushed by the costly rules imposed on them by the Dodd-Frank Act. The ranks of the unbanked have increased", he said.

  • Zachary Reyes