Dodd-Frank is aimed at Wall Street. So why is it hurting the construction industry?

by 27 Aug 2012

More evidence of the unintended consequences of the Dodd-Frank Act:

“With passage of the Dodd-Frank law, the banking and financial services industries face uncertainty that has locked credit markets and access to capital. Many companies have viable, low-risk projects or contracts that simply need funding in order to begin work. However, overregulation in the banking sector has made qualified businesses with a great borrowing track record a risk banks aren’t willing to take.

“For the construction industry, unjustified regulations and unnecessary bureaucratic red tape translate to increased costs, which, if a project does get off the ground, are inevitably passed to the consumer and ultimately impact their ability to hire and expand.”

The following column appeared in the Aug. 24, 2012 edition of the Montgomery Advertiser:

Taxes, regulations hurting businesses
by Rep. Robert Aderholt and Jay Reed

There is little question that our nation’s economy continues to struggle. The question remains, why?

Unemployment has been above 8 percent for 41 consecutive months, the longest stretch of high unemployment since the Great Depression. Since 2009, this administration has heaped on more bureaucratic red tape, more burdensome regulations, more complex and overreaching laws and provided more uncertainty regarding the tax code.

Together these factors have created a perfect storm. A storm that’s drowning job creators and keeping them from hiring at a time when we need jobs more than ever before.

This economic downtown has hurt nearly every sector and industry doing business in the United States. However, few industries have felt the effects and few industries want to provide sustainable, well-paying jobs for American workers more than the trade construction contractors that build the American economy one job at a time.

Today’s economic storm continues to rain down on job creators. While these small businesses are eager to help America’s economy grow jobs and once again prosper, another storm front is moving in and there is no relief in sight, which means there are no new jobs in sight for an industry that has lost more than 1.9 million jobs in just four years.

Like thunder, the current administration is unpredictable and does things with a bang.  In 2011 alone, 32 major regulations were implemented, several of which have a direct impact on the construction industry and come with a price tag of $10 billion annually.

Bureaucratic red tape and ever-changing complex regulatory environment in other industries are indirectly impacting job creators. With passage of the Dodd-Frank law, the banking and financial services industries face uncertainty that has locked credit markets and access to capital. Many companies have viable, low-risk projects or contracts that simply need funding in order to begin work. However, overregulation in the banking sector has made qualified businesses with a great borrowing track record a risk banks aren’t willing to take.

For the construction industry, unjustified regulations and unnecessary bureaucratic red tape translate to increased costs, which, if a project does get off the ground, are inevitably passed to the consumer and ultimately impact their ability to hire and expand.

Read full article from http://financialservices.house.gov

COMMENTS

  • by Time4change | 8/27/2012 2:50:00 PM

    Get on board with other industries Dodd Frank and CFPB are actively screwing up. Meanwhile Wall Street can motor on. Those guilty are not going to jail, not being prosecuted, but the consumers and industries serving them are persecuted. Go figure!

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