During a committee meeting this week, Chairman Jeb Hensarling (R-Texas) blasted the Dodd-Frank Act and said the committee was working on an alternative that would be friendlier to businesses and consumer.
“Dodd-Frank should be called the Obama Financial Control Law, because that’s what it is,” Hensarling said. “It stands as a monument to the arrogance and hubris of man in that its answer to incomprehensible complexity and government control is yet more incomprehensible complexity and government control.”
Hensarling even compared the law’s effect on business to torture.
“Washington’s regulatory waterboarding is drowning community banks and small businesses and sinking the hopes and dreams of millions of low- and middle-income Americans,” he said. “I need not tell you we are losing, on average, one community financial institution every day in America. And they are not perishing of natural causes. The sheer weight, cost, complexity and uncertainty of federal regulation is killing them off – and for the sake of hard-working Americans, it’s just got to stop.”
The Finance Committee’s alternative, Hensarling said, would enact tougher penalties for defrauding consumers and end bailouts.
“Our approach will demand accountability from both financial institutions and financial regulators. We will toughen penalties for those who engage in wrongdoing and defrauding consumers,” he said. “…Our approach will help build the healthy and secure financial system Americans deserve. One that protects consumers by letting you serve their needs in competitive, transparent and innovative markets, vigorously policed for force and fraud. One that ends taxpayer-funded bailouts and instead unleashes America’s entrepreneurial potential.”
The current regulatory system, Hensarling said, is an “unaccountable, arrogant bureaucracy that is dragging us towards the failed economy of a European-style social democracy.”
The Republican alternative, Hensarling said, would provide “vast regulatory relief” to financial institutions that met “high, but simple capital requirements.”
“As we move forward, it’s important to remember that this is not going to be a debate between regulation and de-regulation,” he said. “No, this is going to be a debate over the future of our economy and the hopes and dreams of millions.”
What do you think? Does Dodd-Frank need to be left alone, overhauled, or just scrapped and replaced? Let us know your thoughts in the comments below!
The House Financial Services Committee intends to put forward a “pro-growth, pro-consumer” alternative to the Dodd-Frank Act – which, according to the committee chairman, amounts to “regulatory waterboarding.”