COMER: Statement on passage of the Financial Choice Act

The bill purports to end “too-big-too-fail” by ending Title II of Dodd-Frank, which provided a pathway to resolve the failure of large financial institutions. The FDIC and the Fed are the two regulators responsible for overseeing this requirement under the 2010 law.

However, other Dodd-Frank proponents didn’t take the same “glass is half full” approach, especially with the fiduciary rule.

Though it passed the House Thursday, some lawmakers and experts don’t believe it will be approved in its current form by the Senate, where the Republicans’ majority is far slimmer. “We will replace economic stagnation with a growing, healthy economy”.

But success in the House is viewed as a sign of support for some of the other, more limited proposals that are being considered. “If it were to be passed by the Senate and become law, this bill would make future financial crises more likely and more damaging”.

The Republican-led overhaul of Dodd-Frank was crafted by Rep. Jeb Hensarling of Texas, chairman of the House Financial Services Committee.

Democrats said the legislation would bring about another economic catastrophe by eliminating vital checks on the financial system. She added the bill “pushes back against this excessive regulation so that our local financial institutions can give needed capital to allow our small businesses to thrive”. It would also weaken the authority of the Consumer Financial Protection Bureau, or CFBP – which was championed by Democratic Senator Elizabeth Warren – to regulate large banks and payday lenders.

“It’s still a victory”, said Rep. Warren Davidson, R-Ohio. Elizabeth Warren, D-Mass., and which has pledged to fight for its independence. “This is an terrible bill”.

The measure would take away emergency powers that regulators have to wind down a failing bank which Hensarling “enshrined” Wall Street bailouts into law.

The bill would also make changes to the financial regulatory structure that pre-dated Dodd-Frank. It would put the Federal Reserve’s bank supervisory function and the Federal Deposit Insurance Corporation into the appropriations process.

Overall, the Congressional Budget Office estimates that the House bill would reduce the deficit by almost $25 billion, partly by changing CFPB’s funding but more substantially by eliminating the Federal Deposit Insurance Corp.’s ability to use a fund to stabilize a large, insolvent bank holding company and gradually wind it down.

The Credit Union National Association figures that CFPB regulations cost credit unions more than $7 billion in compliance costs in one year alone.

“The House should easily clear the almost 600-page package, but its fate is already sealed as the Senate is expected to focus on crafting its own package of reforms that can clear a 60-vote threshold”, Boltansky said.

FILE – In this May 21, 2010, file photo, then-Senate Banking Committee Chairman Sen. These community banks have been the targets of bipartisan, regulatory relief bills in recent years, such as a provision to lengthen the time between bank examinations by regulators. “Republicans want nothing more than to kill it”.

The House bill would likely have its greatest impact on the big banks.

“This legislation comes to the rescue of Main Street America”, said House Speaker Paul Ryan (R-Wis.) during a press conference Wednesday morning.

“Dodd-Frank is a highly imperfect bill, but it was a massive step in the right direction on many fronts”, said Francesco Trebbi, a professor of economics at the University of British Columbia in Vancouver, whose work has found no evidence that Dodd-Frank limited liquidity.

“Small businesses are struggling”.

“I haven’t changed my mind on the issue, just like I haven’t changed my mind on the issue of the corporate welfare and cronyism of the Export-Import Bank”, Hensarling said.