financialservices.house.gov
Cmte Financial Services (R)
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WEEK IN REVIEW
Washington, Mar 31 -
Regulatory Overkill Cutting Off Access to Credit The Financial Institutions and Consumer Credit Subcommittee held a hearing on Tuesday to examine the state of bank lending in America. Subcommittee members heard testimony from witnesses that Washington’s regulatory burden is restricting small business and consumer access to credit. “Despite the rhetoric fed to us since its passage, consumers and small businesses haven't been protected by Dodd-Frank. Rather, the rules and regulations billed as the pathway to a stable economy have stifled small institutions and led to more restricted access to much more expensive credit. Even the Consumer Financial Protection Bureau, which purports to protect consumers, has smothered innovation and financial products that Americans want and need,” said Chairman Blaine Luetkemeyer (R-MO). “The result is that consumers and small businesses, the drivers of our economy, are left sitting on the sidelines and struggling to survive.” Witnesses appearing before the subcommittee agreed. “Today, credit availability is substantially more constrained than it has been historically,” said David Motley, President of Colonial Companies. “Simply put, regulatory overkill is cutting off access to credit for credit-worthy borrowers. The expense and distraction of regulatory compliance divert scarce funding and management resources from community lending – particularly for those marginal borrowers whose applications warrant closer review and a greater capacity for risk. These are the borrowers who get squeezed out by today’s regulatory burden,” testified Scott Heitkamp, President and Chief Executive Officer of ValueBank Texas. “NFIB worries that over regulating these smaller, community banks will create more bank consolidation and deter new bank formations. Loans to these small businesses are critical to the health of local communities and, collectively, to the health of the small-business sector,” said Holly Wade, Director of Research and Policy Analysis at the National Federation of Independent Businesses. Dodd-Frank’s Arbitrary ‘Too Big to Fail’ Process The Oversight and Investigations Subcommittee held a hearing on Tuesday to examine the arbitrary and inconsistent process used by the Financial Stability Oversight Council (FSOC) to designate systemically important financial institutions – those deemed by Washington as “too big to fail.” “Dodd-Frank doubled down on the failed lessons of the financial crisis by creating the Financial Stability Oversight Council, enshrining ‘too big to fail,’ and further empowering bureaucrats who have continually side-stepped transparency and accountability while imposing arbitrary rules and back-room regulations on American taxpayers,” said Chairman Ann Wagner (R-MO). Subcommittee members heard from a panel of witnesses who testified on the designation process and the Committee’s recent Majority Staff Report. “Through the Financial CHOICE Act, we will hold FSOC more accountable, end taxpayer-funded bailouts, and open up our economy through smarter regulations to provide American families with the financial relief they deserve,” added Chairman Wagner. The Case for Repealing the Volcker Rule The Capital Markets, Securities and Investment Subcommittee held a hearing on Wednesday to examine the Dodd-Frank Act regulation known as the Volcker Rule. Witnesses testified that the Volcker Rule harms dealers’ ability to act as market-makers and provide crucial liquidity to U.S. capital markets. Professor Charles Whitehead of Cornell University testified, “The challenge is not how much capital is raised, but the incremental cost to issuers of raising it – a cost that affects Main Street as much as it affects Wall Street. The result is costly regulation with limited upside and the potential for greater downside.” “Hardworking Americans rely on the capital markets to save for everything from college to retirement,” said Chairman Bill Huizenga (R-MI). “We as Congress must act to eliminate the burdensome and unnecessary regulations such as the Volcker Rule to ensure the U.S. capital markets remain the deepest and most liquid so that all investors receive the greatest return on their investment.” Member Spotlights Rep. Scott Tipton (R-CO) | The CFPB Goes Against Government of the People, by the People The core mission of the CFPB, protecting consumers from bad actors, is important, but we should all be concerned about the unconstitutional structure of the Bureau. Rep. Roger Williams (R-TX) | Send The Prepaid Card Rule To The Shredder Before the Obama Administration turned over the keys to President Donald Trump, agency regulators used and abused their rulemaking authority to dole out hundreds of new federal government rules. So it wasn’t surprising when a rogue government agency, spawned from the 2,300-page Dodd-Frank Act, followed suit. Rep. Blaine Luetkemeyer (R-MO) | CFPB is Hurting Consumers and Needs Reform The CFPB has been burying consumers and our economy under an avalanche of regulations. Many of these misdirected guidelines are drawn up by disconnected bureaucrats under the influence of flawed statistics and without a clear understanding of their impact on the consumers they aim to protect. Weekend Must Reads Pittsburgh Tribune–Review |Consumer Financial Protection Bureau: Kill it Rather than seek the authority to fire the director of the outrageously imposing Consumer Financial Protection Bureau, President Donald Trump should instead focus on vanquishing this bureaucratic monstrosity. The Hill | Financial oversight board's review process cloaked in mystery A recent report by the House Financial Services Subcommittee on Oversight and Investigations on “The Arbitrary and Inconsistent FSOC Nonbank Designation Process,” followed by a subsequent discussion of the findings at a hearing on March 28, perfectly demonstrates what happens with an out-of-control government institution. Wall Street Journal | Does ‘Too Big to Fail’ Mean Too Big for the Rule of Law? Seven years later, Dodd-Frank reforms have achieved far less than promised. That’s especially true of the framework for designating insurance companies and other non-banks as “systemically important financial institutions,” or SIFIs. Morning Consult | Financing Main Street Success Imagine small business owners on Main Street America. They’re familiar faces to all of us: friends, family members and neighbors. They’re the people whose work brings energy to our hometowns and life to our economy. Fox Business | Economic Growth Depends on Common Sense Reg. Reform: America's Bankers Last week, nearly 1,500 bankers took a unified message to Capitol Hill: America’s banks want to help Congress achieve our shared goals for a vibrant and growing economy. On the Horizon Tuesday, April 4 at 10:00 a.m. Wednesday, April 5 at 10:00 a.m. Thursday, April 6 at 9:15 a.m. In the News The Hill | Dems debate working with GOP on consumer bureau revamp WSJ | SEC Pick Jay Clayton to Get Senate Panel’s Green Light Next Week American Banker | Lawmakers consider broad Dodd-Frank carve-out for small institutions WSJ | Sluggish Housing Recovery Took $300 Billion Toll on U.S. Economy, Data Show Washington Examiner | Bill to create section of bankruptcy code for banks advances in House Investment News | DOL sends final fiduciary rule delay to Office of Management and Budget
Monetary Policy and Trade Subcommittee
“Examining the Federal Reserve’s Mandate and Governance Structure”
Tuesday, April 4 at 2:00 p.m.
Joint Hearing: Monetary Policy and Trade Subcommittee & Terrorism and Illicit Finance Subcommittee
“Increasing the Effectiveness of Non-Nuclear Sanctions Against Iran”
Full Committee
“The 2016 Semi-Annual Reports of the Bureau of Consumer Financial Protection”
Financial Institutions and Consumer Credit
“Examination of the Federal Financial Regulatory System and Opportunities for Reform”