Monday, June 12, 2017
Graves: Dodd-Frank must be repealed
We see it all the time when Washington tries to step in and solve all of our problems. Laws that are well-intentioned but poorly designed end up causing more harm than good, creating new problems and new things for Washington to “fix.”
A perfect example of that is the Dodd-Frank Act, which was signed into law under President Obama in response to the financial crisis of 2007 and 2008. The law was meant to put a check on the Wall Street banks whose irresponsibility helped create that crisis, but the issue was much more complicated than that.
I’ve never believed that government - especially in Washington - can wave a magic wand and fix economic issues that pop up in a free-market system. It’s not the federal government’s job to save failing industries, and it’s certainly its responsibility to pick winners and losers in the market.
No one argues that Wall Street needs some commonsense regulation. But more regulation isn’t always good regulation, and more government surely isn’t always good government. I’ve usually found it’s just the opposite.
Dodd-Frank exploded the size of government, with more pages of rules and regulations than any other Obama-era law. Even Obamacare. What’s worse, the bad actors who helped caused the financial collapse were given a blank check, as Dodd-Frank made the policies of “too big to fail” part of federal law.
As a result, big banks on Wall Street have gotten bigger, and community banks across the country have been closing in record numbers. That sends ripples throughout the economy of Middle America, leaving entrepreneurs and farmers with no one to turn to for business loans or access to capital.
Last week, I helped pass H.R. 10, the Financial CHOICE Act, which repeals Dodd-Frank and 'too big to fail,' makes taxpayer bailouts of Wall Street a thing of the past, and will remove costly regulations on community banks that have made it impossible for them to compete with big banks in urban areas. The Congressional Budget Office also estimates that the CHOICE Act will cut the federal deficit by $24 billion over the next 10 years.
To get the economic growth this country needs, we rely on entrepreneurs and small companies to have every resource they need to invest in their businesses and create jobs. This cannot happen without the community banks that provide capital to small and medium-sized business. The House’s repeal of Dodd-Frank is a critical first step in that process.