House Approves Financial CHOICE Act In Major Step to Repealing Dodd-Frank

June 9,2017
the staff of the Ridgewood blog

Washington DC, The House on Thursday passed the Financial CHOICE Act, legislation to overhaul and replace the failed Dodd-Frank Act that has contributed to the worst economic recovery of the last 70 years.

“Every promise of Dodd-Frank has been broken,” said Financial Services Committee Chairman Jeb Hensarling (R-TX), as he read letters from Americans about how they were declined home, automobile and small business loans due to Dodd-Frank’s burdensome regulations. “Fortunately there is a better, smarter way. It’s called the Financial CHOICE Act. It stands for economic growth for all, but bank bailouts for none. We will end bank bailouts once and for all. We will replace bailouts with bankruptcy. We will replace economic stagnation with a growing, healthy economy,” he said.

“We will make sure there is needed regulatory relief for our small banks and credit unions, because it’s our small banks and credit unions that lend to our small businesses that are the jobs engine of our economy and make sure the American dream is not a pipe dream,” said Chairman Hensarling.

CHOICE, which stands for Creating Hope and Opportunity for Investors, Consumers and Entrepreneurs, has received strong support from community banks and credit unions. Large financial institutions did not offer their support for the Financial CHOICE Act. Instead, Wall Street CEOs have publicly said they do not support repealing Dodd-Frank.

The Congressional Budget Office reports the Financial CHOICE Act would reduce the deficit by $33.6 billion over 10 years and that the bill’s regulatory relief would benefit community banks and credit unions. The nation’s largest banks would be unlikely to raise enough capital to meet the bill’s requirement for substantial regulatory relief, the CBO reported.

FINANCIAL CHOICE ACT AT A GLANCE:

BANKRUPTCY, NOT BAILOUTS

No more bailouts: that’s at the core of the Financial CHOICE Act. With changes to the bankruptcy code, large financial firms can fail without disrupting the entire economy or forcing hardworking taxpayers to pay for more bailouts.

ACCOUNTABILITY FOR WALL STREET AND WASHINGTON

The Financial CHOICE Act includes the toughest penalties in history for those who commit financial fraud and insider trading. Holding Wall Street accountable with the toughest penalties in history will deter corporate wrongdoing and better protect consumers. At the same time the Financial CHOICE Act holds Wall Street accountable, it also holds Washington accountable. Tougher accountability for Wall Street and Washington will protect the integrity of our markets so they benefit ordinary Americans who are working, saving and investing.

STRONGLY CAPITALIZED BANKS

Dodd-Frank’s one-size-fits-all regulations treat all financial institutions the same, regardless of their size. That makes no sense and hurts smaller, hometown banks and credit unions that did nothing to cause the last financial crisis.

The Financial CHOICE Act is based on two important principles: First, all banks need to be well-capitalized and, second, community banks and credit unions deserve relief from the crushing burden of over-regulation. Under the Financial CHOICE Act, banks and credit unions will qualify for regulatory relief if they elect to maintain enough capital to ensure that if they get in trouble, taxpayers won’t be forced to bail them out. Ninety-eight percent of the financial institutions that met the Financial CHOICE Act’s requirements for being well-capitalized did not fail during the financial crisis. Of the miniscule percentage that did fail, none posed a systemic risk.

EMPOWER AMERICANS

The Financial CHOICE Act grows our economy from Main Street up. Dodd-Frank tries to control the economy from Washington down. The Financial CHOICE Act will help get credit and capital into the hands of working men and women to fuel their economic growth.

Hensarling Discusses Financial CHOICE Act on Morning Joe, Squawk Box

NEW YORK -- Financial Services Committee Chairman Jeb Hensarling (R-TX) joined MSNBC’s Morning Joe and CNBC’s Squawk Box to discuss the Financial CHOICE Act – a bill to end taxpayer-funded bailouts of Wall Street banks and create more opportunities for Americans on Main Street.

On the CFPB:

"The best form of consumer protection is competitive, innovative, transparent markets that are vigorously policed for force and fraud. But the so called CFPB in many cases has actually hurt consumers since it has come into fruition...what we are trying to do is replace it with something called the Consumer Law Enforcement Agency that is there to actually enforce our roughly two-dozen major federal consumer protection laws, but it is there to enforce the law, not make up the law and this particular agency is making up the law."

On the failures of Dodd-Frank:

"Dodd Frank has broken all of its promises. It said it would lift the economy and yet we continue to be stuck in a one and a half to two percent GDP growth economy. It said it would end bank bailouts, but cynically it codified them into law. It said it would make our financial system more stable, but the big banks are actually bigger, and small banks are fewer. We are actually losing one a day. Then last but not least, again it said it would help the consumers, but in many cases consumers are worse off. We have had seven years of Dodd Frank, it has failed and we need economic growth for all and bank bailouts for none. The answer is more capital, not more regulation."

On next steps:

"I am willing to negotiate, but I am not willing to negotiate against myself. So I will wait to see what the Senate will produce. Again part of the CHOICE Act can be done through reconciliation, other provisions will have to be negotiated. I stand ready to negotiate in good faith with Democrat colleagues in the Senate, but they are going to have to get something passed and I think increasingly, the mere fact that we would pass the Financial CHOICE Act will create greater momentum for this to get done. I know it is still a priority of the Administration, I met with the Vice President last evening who reiterated it is a priority to get it done. This along with healthcare reform and tax reform, and reform of our banking capital market systems is what is key to getting America back on track."

For more on the Financial CHOICE Act visit FinancialCHOICE.gop.

House GOP Moves to End "Bailout Nation" with the Financial CHOICE Act

No More Bank Bailouts, Accountability for Wall Street and Washington, Economic Growth at the Core of Republican Plan

April 20,2017
the staff of the Ridgewood blog

WASHINGTON – Financial Services Committee Chairman Jeb Hensarling (R-TX) today announced that the Committee will hold a hearing to discuss the Financial CHOICE Act on Wednesday, April 26 at 10:00 a.m.

“Republicans are eager to work with the President to end and replace the Dodd-Frank mistake with the Financial CHOICE Act because it holds Wall Street and Washington accountable, ends taxpayer-funded bank bailouts, and unleashes America’s economic potential,” said Chairman Hensarling. “We want economic opportunity for all, bailouts for none. We want real consumer protections that will give you more choices. Our solution grows the economy from Main Street up, creates more opportunities for working families to get ahead, and levels the playing field with no more Wall Street bailouts.”

CHOICE stands for Creating Hope and Opportunity for Investors, Consumers and Entrepreneurs.

The ideas and principles behind the Financial CHOICE Act were first unveiled last June by Chairman Hensarling in a speech to the Economic Club of New York. The Financial Services Committee approved the Financial CHOICE Act in September. The Committee will discuss an updated version of the bill at Wednesday’s hearing.

“Supporters of Dodd-Frank promised it would lift the economy, end bailouts and protect consumers. Yet Americans have suffered through the worst recovery in 70 years, Dodd-Frank guarantees future bailouts for Wall Street, and consumers are paying more and have fewer choices. Dodd-Frank failed to keep its promises to the American people, but we will work with President Trump to follow through on his promise to dismantle Dodd-Frank. That’s not what Wall Street wants, but it is what hardworking Americans need to have a healthier economy with more opportunities so they can achieve financial independence.”

FINANCIAL CHOICE ACT AT A GLANCE:

BANKRUPTCY, NOT BAILOUTS

No more bailouts: that’s at the core of our plan and our commitment to hardworking taxpayers. With bipartisan changes to our bankruptcy code, large financial firms can fail without disrupting the entire economy or forcing hardworking taxpayers to pay for more bailouts.

ACCOUNTABILITY FOR WALL STREET AND WASHINGTON

The Financial CHOICE Act includes the toughest penalties in history for those who commit financial fraud and insider trading. Holding Wall Street accountable with the toughest penalties in history will deter corporate wrongdoing and better protect consumers. At the same time we hold Wall Street accountable, the Financial CHOICE Act also holds Washington accountable. Tougher accountability for Wall Street and Washington will protect the integrity of our markets so they benefit ordinary Americans who are working, saving and investing.

STRONGLY CAPITALIZED BANKS

Dodd-Frank’s one-size-fits-all regulations treat all financial institutions the same, regardless of their size. That makes no sense and hurts smaller, hometown banks and credit unions that did nothing to cause the last financial crisis.

The Financial CHOICE Act is based on two important principles: First, all banks need to be well-capitalized and, second, community banks and credit unions deserve relief from the crushing burden of over-regulation. Under the Financial CHOICE Act, banks and credit unions will qualify for regulatory relief if they elect to maintain enough capital to ensure that if they get in trouble, taxpayers won’t be forced to bail them out. Ninety-eight percent of the financial institutions that met the Financial CHOICE Act’s requirements for being well-capitalized did not fail during the financial crisis. Of the miniscule percentage that did fail, none posed a systemic risk.

EMPOWER AMERICANS

The Financial CHOICE Act grows our economy from Main Street up. Dodd-Frank tries to control the economy from Washington down. The Financial CHOICE Act will help get credit and capital into the hands of working men and women to fuel their economic growth.