WASHINGTON – The U.S. House passed on Thursday a massive bill designed to repeal many Obama-era Wall Street regulations.
The new legislation, known as the Financial CHOICE Act, is the signature legislative effort of U.S. Rep. Jeb Hensarling, R-Dallas, during his tenure as the House Financial Services Committee chairman. It passed the House on a mostly party-line vote of 233-186. The Texas delegation vote broke down along party lines, with the exception of U.S. Rep. Sam Johnson, R-Richardson, who was absent.
The bill dismantles much of the 2010 Dodd-Frank Wall Street overhaul, which was drafted in response to the 2008 financial crisis and became a signature accomplishment of the Obama administration.
While the bill breezed through the House chamber, its path forward in the U.S. Senate is far less certain, where Democratic support would be needed to draw the necessary 60 votes.
The Hensarling bill is an embrace of free-market principles over Dodd-Frank regulations that he and other Republicans argued inhibited economic growth. Hensarling is one of the staunchest believers in such policies and was a protege of former U.S. Sen. Phil Gramm of Texas, who helped lead financial deregulation efforts in Congress in the 1990s.
The Hensarling bill, if it passes becomes law, will:
- Repeal the "too big to fail" procedures designed to unwind large investment banks in the event of a meltdown, out of concern that their immediate closure would create instability in the financial industry.
- Severely weaken the Consumer Financial Protection Bureau, a government agency with a mission to protect consumers from predatory lenders. Earlier this year, Hensarling called the bureau “Orwellian.”
Hensarling spent much of the afternoon managing the debate on the House floor and made his own remarks.
"There will be economic growth for all, bank bailouts for none, and we will have an America that is only limited by the size of its dreams," Hensarling said. His bill had the strong backing of a close friend, U.S. House Speaker Paul Ryan.
House Democratic leaders were unconvinced and bashed the bill in a news conference just prior to the vote.
Hensarling's Democratic counterpart on theHouse Financial Services Committee, Maxine Waters of California, told reporters the bill would "pave the way back to the financial crisis."
The Democratic whip, U.S. Rep. Steny Hoyer of Maryland, forecasted that the bill would never make it to President Trump's desk.
"I am sure it will not pass the United States Senate because it is the wrong choice," he said.