I really wasn’t surprised to learn that the U.S. House of Representatives had passed a bill scaling back the 2010 Wall Street financial reforms. If anybody doubts that Wall Street giants have tremendous influence in Congress, this sort of thing is pretty good proof. This was a blow to the public and a victory for Wall Street. House Republicans claim the Dodd-Frank law is unworkable and an unnecessary burden on American businesses. The bill was sent to the U.S. Senate. Hopefully, there will be senators – both Republicans and Democrats – who will defend the law and not yield to pressure from Wall Street. The vote in the House, 271 to 154, was along party lines.
The bill, if passed, will among other changes give banks extra time to comply with part of the law’s controversial Volcker rule and loosen disclosure requirements for small companies seeking to raise capital. Predictably, House Financial Services Committee Chairman Jeb Hensarling, a Republican, had this to say:
The community banks and the Main Street businesses that are trying to put America back to work are suffering under the sheer weight, load, volume, complexity and cost of the regulatory burden that has been imposed.
Republicans control both the House and Senate after major wins in last November’s elections. They have made it a top priority to reduce what they view as a “burden on business” due to federal regulation. The House approved a bill that creates extra hurdles for agencies writing new rules. Without a doubt, the Dodd-Frank law is a top target. Republicans brought up the financial regulation bill as soon as they returned to Washington last month. They first tried to move it quickly under special rules that required two-thirds of the House’s approval, but Democrats defeated that plan.
Then supporters, including 29 Democrats, approved the bill under normal rules that required fewer votes. Hopefully, this ill-advised bill won’t pass in the Senate. Republicans hold a slimmer majority there than they do in the House. The bill’s most controversial portion relates to the Volcker rule, which bans banks from making risky trades with their own money and restricts certain types of investments. The bill passed by the House gives banks two more years to comply with a section related to collateralized loan obligations, or bundles of business loans. Banks said they would have to dump investments, disrupting the market, if the rules were not changed.
President Barack Obama has threatened to veto the bill if it reaches his desk. Hopefully, enough Senators will remember how Wall Street banks operated prior to enactment of the Dodd-Frank legislation. They came very close to destroying our nation’s economy.
Contact us today for a free legal consultation with an experienced attorney.
Fields marked *may be required for submission.
If you would like to subscribe to the Jere Beasley Report digital edition, simply visit our Subscriptions page and provide the necessary information or call us at 800-898-2034.
Attorney Advertising - Prior results do not guarantee a similar outcome.