House Passes Financial CHOICE Bill To Undo Dodd-Frank
U.S. House Republicans fulfilled a campaign promise on Thursday by passing the Financial Choice Act along party lines. The bill attempts to undo much of Dodd-Frank, the financial regulation law created after the great recession.
The GOP bill is wide-ranging, but its core would ease rules on banks that lower their debt ratio. In theory, this would make them less risky. Speaker Paul Ryan framed the bill as a way to help community banks.
“They're being crushed by the costly rules imposed on them by the Dodd-Frank Act. This law may have had good intentions, but its consequences have been dire for Main Street.”
Ryan says with fewer rules, banks can make more loans to small businesses and grow the economy. However, critics call the Financial Choice Act dangerous because it would reduce scrutiny of banks. It also defangs the Consumer Financial Protection Bureau, allows Wall Street to review new regulations, and weakens conflict of interest rules. Only parts of the bill are expected to be picked up in the Senate.