House Financial Services Committee chairman Jeb Hensarling (R-Texas) will say in a policy speech on Tuesday that the 2010 Dodd-Frank Wall Street Reform law has made the country “less financially stable.”
Hensarling’s attack on the fifth anniversary of Dodd-Frank, will come during a speech at the American Enterprise Institute in Washington.
“The Dodd-Frank architecture, first of all, has made us less financially stable,” Hensarling will say, according to excerpts obtained by The Hill. “Since the passage of Dodd-Frank, the big banks are bigger and the small banks are fewer… Dodd-Frank concentrates greater assets in fewer institutions. This is bad policy and bad economics.”
He will argue that Dodd-Frank’s regulations — despite being written largely for financial institutions — have impacted “grocery markets, cable TV servers and bowling alley chains” that “must comply with regulations imposing wage controls, salary ratios and private compensation disclosures made for Wall Street investment firms.”
Hensarling made similar arguments on Saturday, when he delivered the Republicans’ weekly address, as well as in an op-ed for The Wall Street Journal published earlier Monday.
Liberals like Sen. Elizabeth Warren (D-Mass.) and Democratic presidential candidate Sen. Bernie Sanders (I-Vt.) have argued that Dodd-Frank didn’t go far enough in regulating the markets.
They have criticized the financial industry for lobbying heavily against Dodd-Frank to weaken its regulations.
Warren and Sens. Sherrod Brown (D-Ohio), Charles Schumer (D-N.Y.), Patty Murray (D-Wash.), Senate Minority Leader Harry Reid (D-Nev.) as well as other progressives will have a press conference on Tuesday attacking Republicans for trying to weaken Dodd-Frank.
They will be joined by former-Sen. Chris Dodd (D-Conn.), who helped author the legislation. Retired-Rep. Barney Frank (D-Mass.) is speaking at a forum hosted by Third Way in Washington earlier Tuesday.
Dodd-Frank remains one of the Obama administration’s top legacy items.
“You may not have heard of Dodd-Frank, but it’s essentially Obamacare for our economy and your household finances,” Hensarling said Saturday.
In his WSJ op-ed, Hensarling said that “it wasn’t deregulation that caused the crisis, it was dumb regulation.”
“Washington not only failed to prevent the crisis, it led us into it,” he added. “What is most disturbing about Dodd-Frank is the authority it gives bureaucrats to control huge swaths of the economy.”