Representative Jeb Hensarling (R-TX) urged the repeal of the Dodd-Frank Act during Saturday’s GOP Weekly Address.
“Hello, I’m Jeb Hensarling, Congressman for the Fifth District of Texas and Chairman of the House Financial Services Committee.
Five years ago this week President Obama signed into law the Dodd-Frank Act. You may not have heard of Dodd-Frank, but it’s essentially Obamacare for our economy and your household finances.
And just like Obamacare, Dodd-Frank has left us with fewer choices, higher costs and less freedom.
Now, the financial crisis of 2008 and the recession that followed devastated millions of Americans. But instead of preventing the crisis, misguided Washington policies helped lead us into it – policies that either strong-armed or enticed financial institutions into loaning money to people to buy homes they couldn’t afford to keep.
That was wrong.
It wasn’t deregulation that caused the crisis. It was Washington’s dumb regulations.
Then, and now, House Republicans have offered an alternative to Dodd-Frank that would have ended taxpayer-funded bailouts and protected consumers.
But in typical Washington fashion, Democrats instead by passing a 2,300-page bill that did not solve the crisis but in my ways made it worse. When President Obama signed Dodd-Frank into law five years ago with much fanfare and celebration, we were told it would ‘lift the economy,’ ‘end too big to fail’ and ‘increase financial stability.’ It didn’t happen.
But, Dodd-Frank did nothing to reform Fannie Mae and Freddie Mac, which were at the epicenter of the crisis. It enshrined taxpayer-funded bailouts and ‘too big to fail’ into law, and it imposed 400 new burdensome, job-destroying regulations upon our economy.
And the harm to consumers has been real, very real. We continue to be mired in lackluster, halting economic growth. Middle income paychecks are nearly 12,000 dollars less compared to the average post-war economic recovery. It is now harder for credit-worthy Americans to buy a home. In fact, one-out-of-five who borrowed to buy a home just five years ago will not meet the underwriting requirements of Dodd-Frank’s mortgage rules. According to the Federal Reserve, that’ll hit roughly one-third of Hispanic and African-American borrowers.
Since Dodd-Frank, the big banks have gotten bigger and the small banks are now fewer. Today there are fewer community banks and credit unions serving the needs of small businesses and families. Local financial institutions tell us they can’t keep up with the sheer weight, volume and complexity of Dodd-Frank’s regulations. In fact, because of Dodd-Frank, we’re losing on average one community financial institution per day. It’s no wonder that small business deaths outnumber small business births for the first time in 35 years.
It is also now more expensive for American companies to raise working capital that’s needed to grow and create jobs.
Services that we all once took for granted – like free checking – are being curtailed or eliminated because of Dodd-Frank. Before, 75 percent of banks offered free checking. Just two years after Dodd-Frank became law, that number was cut almost in half.
And bank fees have also increased due to Dodd-Frank’s costs. This has led to a rise in the number of low and moderate income Americans who simply can’t afford to maintain a checking or savings account.
Not long after the financial crisis, we heard the cry from the Left to ‘Occupy Wall Street.’ But hardworking taxpayers aren’t interested in Occupying Wall Street. They just want to quit bailing it out.
Yet Dodd-Frank enshrines ‘Too Big to Fail’ into law. It gives Washington bureaucrats the power to officially designate large financial firms ‘Too Big to Fail’ and then makes them eligible for bailouts. That’s wrong. We have to absolutely end bailouts — period.
It is evident that Dodd-Frank has made us less prosperous and less free. It has meant lost opportunities and frustrated dreams for millions hoping to start a small business, buy a home or plan for a secure retirement.
If we want strong economic growth, more freedom and an end to bailouts, it’s time we commit to making sure this anniversary is Dodd-Frank’s last anniversary.
House Republicans are working to do just that. Together, we can end Wall Street bailouts, have a healthier economy, and protect consumer choice.
Thanks for listening.”
Follow Ian Hanchett on Twitter @IanHanchett