financialservices.house.gov

Cmte Financial Services (R)
Contact:


McHenry: From Europe to the Middle East to Asia, Global Unrest is Creating Additional Challenges for the International Financial System

Washington, Jul 9 -

Today, the House Financial Services Committee, led by Chairman Patrick McHenry (NC-10), is holding a hearing with Treasury Secretary Janet Yellen on the state of the international financial system. Republicans are highlighting how the Biden Administration’s conflicting approaches to foreign policy call into question America’s leadership on the global stage.

Watch Chairman McHenry’s opening remarks here.

Read Chairman McHenry’s opening remarks as prepared for delivery:

“Secretary Yellen, I appreciate you being here today.

“From Europe to the Middle East to Asia, global unrest is creating additional challenges for the international financial system.

“There are also rising risks emerging from our own domestic failures here at home.

“The IMF recently warned that U.S. deficits and debt now present ‘a growing risk to the U.S. and global economy’ and should be ‘urgently addressed.’

“In last year’s negotiations surrounding the debt ceiling, House Republicans secured historic guardrails on federal spending with the Fiscal Responsibility Act.

“Unfortunately, the Biden Administration has undermined this bipartisan progress at every turn with reckless executive actions.

“But government debt isn’t just a challenge for America. Total public debt globally is at record levels.

“Much of it is held by emerging market economies with poor creditworthiness at depressed interest rates that do not accurately reflect the default risk.

“This problem is exacerbated by opaque Chinese infrastructure lending through its belt and road initiative.

“Communist China is now the largest creditor for the developing world.

“To add insult to injury, it remains one of the largest annual borrowers from the World Bank, despite assurances that these loans would be phased out.

“The Biden Administration is failing to leverage US standing at the International Financial Institutions to block financing for the Chinese Communist Party.

“At the same time, Treasury is proposing a multi-year process to stand up an entire new bureaucracy to regulate private U.S. investment to China.

“To be sure, the recently proposed rulemaking is a step in the right direction and more responsible than other proposals.

“However, this approach will take years to implement. It lacks the urgency necessary to confront the generational threat posed by the CCP.

“We have an existing, time-tested sanctions regime that can have an immediate impact. I urge the Biden Administration to use it.

“Any serious effort—whether legislative or administrative—to block global funding for the Chinese military-industrial complex must include the full blocking sanctions in Congressman Andy Barr’s Chinese Military and Surveillance Company Sanctions Act.

“Treasury has also implemented its beneficial ownership reporting regime as the Administration’s principal effort to crack down on malign foreign actors in the U.S. financial system. There was bipartisan support in Congress for this reporting regime for two reasons. 

“First, it was supposed to be narrowly targeted to strengthen our national security tools. Second, it was supposed to protect small businesses from duplicative reporting regimes.

“Thus far, Treasury has failed to adhere to Congressional intent on both counts.

“America also faces grave strategic challenges in Europe and the Middle East.

“The Biden Administration has rightly provided historic military and financial support for Ukraine following Russia’s invasion.

“Yet, Treasury has undermined its own sanctions efforts by allowing Putin to continue funding his war machine through a glaring loophole in its so-called oil price cap.

“Similarly, this administration has wavered in both rhetoric and actions after a promising initial response to Hamas’ barbaric terrorist attacks on Israel last October.

“To begin to right the ship, Treasury must redouble its efforts to cut off funding for Iran and its proxies.

“If nonsensical and contradictory policies like these continue, allies will continue to question America’s—and specifically this Administration’s—leadership on the global stage.”

###