House Republicans take
a major step in dismantling banking rules that were designed to protect consumers.
WASHINGTON — House Republicans took a major step toward their long-promised goal of unwinding the stricter financial rules created after the 2008 crisis, pushing forward sweeping legislation that would undo much of President Barack Obama’s landmark banking law.
A House panel on Thursday approved Republican-written legislation that would gut much of the Dodd-Frank law enacted by Democrats and signed by Obama in the wake of the financial crisis and the Great Recession. The partyline vote in the Republicanled House Financial Services Committee was 34-26.
“I can’t do a good James Brown, but I feel good,” said Rep. Jeb Hensarling, the normally reserved Republican chairman of the committee, referring to the singer often called the godfather of soul. Hensarling wrote much of the overhaul legislation. Republicans argued that the law passed under President Barack Obama is slowing economic growth because of the cost of compliance and by curbing lending. Democrats warned the GOP bill will create the same conditions that led to the financial crisis and pushed the economy to the brink of collapse.
Rep. Maxine Waters, the panel’s senior Democrat, called it “a deeply misguided measure that would bring harm to consumers, investors and our whole economy.”
“The bill is rotten to the core and incredibly divisive,” Waters said. “It’s also dead on arrival in the Senate, and has no chance of becoming law.”
After attempts in recent years to overhaul the DoddFrank legislation, the Republicans were heartened this time by a sympathetic Republican president now in the White House. President Donald Trump has denounced Dodd-Frank and promised that his administration would “do a big number” on it. The new bill now goes to the full House for a vote.
The Republican bill also goes after an agency that enforces consumer protection laws and scrutinizes the practices of virtually any business selling financial products and services. That ranges from credit card companies to mortgage servicers to auto lenders. The bill removes some of the Consumer Financial Protection Bureau’s powers.