WASHINGTON–The House Financial Services Committee yesterday held a hearing on the Financial CHOICE Act, which seeks to undo much of Dodd-Frank.
Prior to the hearing the credit union trade groups had said they largely support the legislation, although they indicated they have some concerns with what’s currently included in the draft legislation, as CUToday.info reported here.
The Committee, chaired by Rep. Jeb Hensarling (R-TX), the primary sponsor of the legislation, heard testimony from seven witnesses, most of whom lean to the right and are supportive of the bill. Credit unions were not represented in the testimony.
CHOICE stands for Creating Hope and Opportunity for Investors, Consumers and Entrepreneurs.
“Republicans are eager to work with the President to end and replace the Dodd-Frank mistake with the Financial CHOICE Act because it holds Wall Street and Washington accountable, ends taxpayer-funded bank bailouts, and unleashes America’s economic potential,” said Hensarling in a statement prior to the hearing. “We want economic opportunity for all, bailouts for none. We want real consumer protections that will give you more choices. Our solution grows the economy from Main Street up, creates more opportunities for working families to get ahead, and levels the playing field with no more Wall Street bailouts.”
Among those testifying to the committee were:
- Peter J. Wallison, Senior Fellow and Arthur F. Burn Fellow, Financial Policy Studies, American Enterprise Institute
- Dr. Robert J. Michel, Senior Research Fellow, Financial Regulations and Monetary Policy, The Heritage Foundation
- Dr. Michael S. Bart, professor of Law, University of Michigan Law School
- Alex J. Pollock, Distinguished Senior Fellow, The R Street Institute
- Dr. Lisa D. Cook, associate professor, Economics and International Relations, Michigan State University
- Hester Peirce, director, Financial Markets Working Group and Senior Research Fellow, Mercatus Center, George Mason University
- John Allison, former president and CEO, Cato Institute
In his testimony, Pollock called Dodd Frank an over-reaction to the financial crisis by a government that had demonstrated it was ill-equipped to regulate the market.
"This was in spite of the remarkably poor record of the government agencies, since they were important causes of, let alone having failed to avoid, the housing bubble and the bust," Pollock said. "Naïve faith that government bureaucracies have superior knowledge of the financial future is a faith I do not share.”
Pollock, who praised aspects of the CHOICE Act designed to improve regulatory transparency and accountability, also suggested an “additional requirement for these reviews. I believe that the Federal Reserve should be required to produce a Savers Impact Statement, quantifying and discussing the effects of its monetary policies on savings and savers.”
A discussion draft of the legislation can be found here: https://financialservices.house.gov/uploadedfiles/choice_2.0_discussion_draft.pd