June 9 (UPI) — The House on Thursday passed a bill to eliminate some of the reform regulations of the Dodd-Frank Act, the sweeping law put into place after the financial crisis.
House Resolution 10, or the Financial Creating Hope and Opportunity for Investors, Consumers and Entrepreneurs (CHOICE) Act of 2017, passed by a vote of 233-186 in the lower chamber Thursday afternoon. Eleven representatives did not vote.
Republican supporters of the bill claim Dodd-Frank stifles small business and the domestic economy with too much regulation. Opponents chide the proposal as the “Wrong Choice Act” and say it’s a handout to Wall Street and a disservice to normal investors.
The regulations of Dodd-Frank were enacted in 2010 by former President Barack Obama as a sweeping effort to put in place certain regulations that make another financial crisis less likely.
“The Financial Choice Act is a jobs bill,” House Speaker Paul Ryan said. “It is why we were sent here, to look out for the people who work hard and do the right thing.”
Though it passed the House on Thursday, some lawmakers and experts don’t believe it will be approved in its current form by the Senate, where the Republicans’ majority is far slimmer. They say some provisions of the proposal, though, could make it through.
Thursday’s vote went nearly straight down the House partisan line. No Democrats voted for the bill and just one Republican, Rep. Walter Jones, R-N.C., voted against it.
The CHOICE Act would shield some financial institutions from Dodd-Frank restrictions that limit risk-taking — which was a major factor in the mortgage industry collapse that preceded the financial crisis and Great Recession. It would also change the way federal law deals with failing financial institutions, which some critics say again supports a “too big to fail” approach.
The bill would also weaken the Consumer Financial Protection Bureau and scrap the Labor Department’s fiduciary rule that requires brokers to act in the best interest of their clients when giving investment advice.
“Instead of protecting consumers, Republicans choose to help those who try to cheat consumers,” House Minority Leader Nancy Pelosi said Thursday. “Dems enacted the strongest consumer financial protections in history. We mustn’t let the GOP roll back these safeguards.”
Trump’s administration has taken multiple steps since January targeting regulations contained in Dodd-Frank — including a resolution in February to scrap another Dodd-Frank regulation intended to increase transparency and reduce corruption.
The first new parts of the 2010 law, which were completed last year under Obama’s administration, are set to take effect Friday.
The Congressional Budget Office said recently that the CHOICE Act would reduce federal deficits by $24.1 billion over the next decade. The CBO warned, though, that the estimates are not definitive because it’s difficult to predict when such a large financial firm might fail next.
