After three days of raucous debate in early May, the Financial Choice of 2017, the Republican bill to replace Dodd-Frank, passed the House Financial Services Committee by a 34-26 vote.
Heated debate ensued over the three-day markup, with Democrats vehemently opposing provisions of the bill that gut the Consumer Financial Protection Bureau, kill the Volcker rule, and repeal the Labor Department’s fiduciary rule so that the Securities and Exchange Commission can move first on a fiduciary rule.
The Financial Choice Act 2.0 now moves to the full House, but doubts persists as to whether there’s appetite in Congress to deal with Dodd-Frank reform.
Senate Majority Leader Mitch McConnell said in mid-May that he’s pessimistic Congress will make major changes to the Dodd-Frank Act because he doubts Republicans can secure enough Democratic votes to pass legislation.
But Senate Banking Committee Chairman Mike Crapo, R-Idaho, said Wednesday during a speech at the Financial Industry Regulatory Authority’s annual meeting in Washington that his goal is to secure bipartisan support for House Financial Services Committee Chairman Jeb Hensarling’s CHOICE Act.
“My goal this Congress is to work in a bipartisan manner with members of the Banking Committee, the administration, Chairman Hensarling and the regulators to strike a balance between smart, thoughtful regulation and promoting economic growth,” Crapo said.
A just-released score by the Congressional Budget Office may buoy the Act’s chances of passage. The non-partisan, independent CBO reports that the Financial CHOICE Act (H.R. 10) will slash the federal budget deficit by $24.1 billion over the next 10 years.
CBO also estimates that community banks and credit unions will be the “overwhelming beneficiaries” of the Financial CHOICE Act as few, if any, of the nation’s biggest banks will meet the bill’s capital requirements to qualify for the greatest regulatory relief.
“The Financial CHOICE Act ends bank bailouts forever, holds Wall Street and Washington accountable, unleashes America’s economic potential and reduces the deficit by billions,” Hensarling said in a Friday statement. “The Financial CHOICE Act is not what Wall Street wants, but it is what Main Street and hardworking taxpayers need. Wall Street CEOs and Democrats are the ones saying ‘don’t repeal Dodd-Frank.’ They know Dodd-Frank gives big banks a competitive advantage, and the big banks have gotten even bigger since Dodd-Frank became law. The Financial CHOICE Act will help struggling community banks and credit unions, as the CBO affirms.”
The revamped version of the bill, dubbed Financial Choice Act 2.0, still says that if the Labor Department promulgates a fiduciary rule, “it must be substantially similar” to one issued by the Securities and Exchange Commission.
Hensarling yields wide power as leader of the committee that oversees the banking industry, the Fed and the SEC.