Heritage Action Supports Hensarling’s Financial CHOICE Act (H.R. 5983)

In response to the housing collapse and financial crisis of 2007-08, Congress rushed to pass the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act under the guise of “consumer protection.” But instead of addressing the root causes of the financial crisis, such as the government’s reckless efforts to expand housing affordability and implied guarantee to bail out large financial institutions, Dodd-Frank empowers the very regulatory establishment which created the environment that led to the financial crisis in the first place.

Heritage Foundation Financial Regulations expert Norbert Michel writes:

“The 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act is among the most inappropriately named laws ever enacted in the U.S. It neither reformed Wall Street nor protected consumers, and it imposed massive new regulations on banks far away from Wall Street.”

Read More

Tweaking Dodd-Frank Opens GOP to Charges of Favoritism

Last week, the House passed the Promoting Job Creation and Reducing Small Business Burdens Act (H.R. 37).  The bill, essentially a package of previous House bills that had garnered strong bipartisan support, makes several small financial regulatory improvements.  But this short-term strategy – making small tweaks to the existing regulatory framework – may not be the best approach for fixing what’s wrong with U.S. financial regulations.

The real problem is not, for instance, whether the Volcker rule requires banks to divest certain types of assets in 2015 or 2019.  The real problem is the Volcker rule itself and, more broadly, the whole mass of regulations impacted by the Dodd-Frank Act.

Read More