WASHINGTON â€” House Republicans moved closer to realizing their long-promised goal to undo financial regulatory laws enacted under Democratic President Barack Obama after the 2008 economic meltdown pushed the economy to the brink of collapse.
A House panel on Thursday is expected to approve a GOP-pushed bill that would repeal about 40 provisions of the Dodd-Frank Act. Banks could qualify for much of the regulatory relief in the bill so long as they meet a strict basic requirement for building capital to cover unexpected big losses.
Republicans, led by Rep. Jeb Hensarling, the GOP chairman of the House Financial Services Committee, have argued that community banks and credit unions are struggling to keep up with the regulatory burdens imposed by the law.
They complained that Dodd-Frank has made it more difficult to lend money to people wanting to buy a car or new house, or to start up a business. Democrats, citing the Federal Reserve, said commercial and industrial loans from commercial banks are at all-time highs. They say Republicans are risking a return to another financial crisis.
While the measure is expected to easily win approval at the committee level and in the full House, it faces a difficult climb in the Senate where it would need 60 votes to become reality. That means the GOP will need several Democrats to join their effort. Leaders of the Senate panel with jurisdiction over a Dodd-Frank overhaul have said they would like to work together to find areas of common agreement to enhance economic growth.
Such agreement was non-existent during the House hearings on Tuesday and Wednesday. Instead, the hearings turned into a contentious debate over Democratic efforts to cast a spotlight on President Donald Trump’s business empire and his refusal to release his tax returns.
The panel debated an amendment that would bar the GOP’s replacement law from going into effect until the Office of Government Ethics certifies that the changes in the bill would not directly benefit Trump or any of his appointees with influence over federal regulations.
“As members of Congress develop a public policy, you have a responsibility to ensure this president is not benefiting,” said Rep. Maxine Waters, the top Democrat on the House Financial Services Committee. “Why hasn’t he shown his tax returns? That would help us understand whether or not he’s benefiting from any of our work.”
Republicans called the amendment as “partisan as it gets.”
“One thing after the next, I see my colleagues on the other side do everything in their power to undermine this president and it’s wrong,” said Rep. Lee Zeldin, R-N.Y.
Presidents are not subject to the conflict of interest laws that their own appointees must follow, but until now they have followed them anyway to set an example. Trump is blazing a different trail by refusing to give up a financial interest in his company while turning over the reins to his adult sons and a senior executive.
Some ethics experts have called for Trump to sell off his assets and place his investments in a blind trust, an entity that his family would not control. That’s what previous presidents have done.
The committee also rebuffed Democratic attempts to protect the Consumer Financial Protection Bureau, the five-year-old agency which enforces consumer protection laws and scrutinizes the practices of virtually any business selling financial products and services.
The bureau gained powers under Dodd-Frank to scrutinize the practices of virtually any business selling financial products and services: credit card companies, payday lenders, mortgage servicers, debt collectors, for-profit colleges, auto lenders, money-transfer agents.
Hensarling’s bill would eliminate those powers. And it would allow the U.S. president to remove the CFPB director at will.
Democrats said that when they created Dodd-Frank, they wanted to make the consumer agency as independent from political influence as possible, but Republicans complained that Congress has too little say over how the bureau operates.
Kevin Freking And Marcy Gordon, The Associated Press