After much anticipation, House Financial Services Committee Jeb Hensarling (R-TX) introduced the Financial CHOICE Act of 2017 (CHOICE Act) last week following a contentious hearing on the bill.
"It shows a blatant disregard for the painful lessons learned during the 2007-2008 financial crisis", Marc Jarsulic, Vice President for Economic Policy at the Center for American Progress, said in a statement.
"When Dodd-Frank was passed almost seven years ago, Americans were promised it would lift the economy", said Hensarling.
Democrats also tried to preserve a new federal rule targeting consumers' retirement investments and the advice they receive from financial professionals.
A congressional panel that writes rules for Wall Street advanced plans to overhaul the Dodd-Frank Act, gaining ground in Republican efforts to reverse post-crisis restraints on banks. Democrats countered that the GOP effort risked a repeat of the 2008 meltdown that pushed the economy to the brink of collapse.
Maxine Waters, D-Calif., the ranking Democrat on the committee, called the Choice Act "an invitation for another Great Recession or worse". Rep. Michael Capuano, D-Mass., said Republicans could have written a much narrower bill to help small banks and credit unions if that were their primary aim.
Republicans said the number of community banks in the US was declining because of Dodd-Frank. "So we're going to look at that", Trump said during an interview with Bloomberg News.
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While the measure is expected to easily win approval at the committee level and in the full House, it faces a hard climb in the Senate where it would need 60 votes to become reality.
In a fast-moving session following two days of laborious debate, the panel flew through a series of votes on amendments, as the majority Republicans easily beat back Democrats' attempts to reshape and soften the legislation.
Hensarling's bill would create an alternative path for banks to bypass a number of tougher restrictions under the law, if they meet a certain measure of bank capital. Democratic lawmakers predicted that at the end of the process, the bill would not become law despite an ally in the White House. "It's important that we get tax reform done".
"It's a real problem because those community financial institutions are the backbone of our economy", Andy Barr, a Republican from Kentucky said during the markup. Its toughest test could come in the Senate, where it would need to garner Democratic support for passage.
Such agreement was non-existent during the House hearings on Tuesday and Wednesday. President Trump nominated Mr. Clayton in January and the Senate Banking Committee voted to in April to advance his nomination, which notably received three votes from Democrats. That ranges from credit card companies to mortgage servicers to auto lenders.
Furthermore, Dodd-Frank has led to an unprecedented expansion of the administrative state, where bureaucrats operate in the shadows with unrestricted powers and complete lack of transparency-arbitrarily crushing our small businesses and community financial institutions with onerous and ineffective regulations. It would also have to answer to Congress for its funding.
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