House Dems move to delay GOP Dodd-Frank rewrite

Democrats on the House Financial Services Committee are moving to prolong a hearing on a GOP Dodd-Frank Act rollback by several hours, if not days.

The House Financial Services Committee on Tuesday began marking up Chairman Jeb Hensarling’s (R-Texas) Creating Hope and Opportunity for Investors, Consumers and Entrepreneurs (CHOICE) Act, a sweeping rewrite of post-recession financial regulations that GOP lawmakers have long sought to repeal.

Democrats are fiercely opposed to the CHOICE Act and took several steps during the Tuesday hearing to delay a possible House vote on it despite the bill being largely considered dead on arrival in the Senate. They’re expected to offer dozens of amendments, though the committee won’t vote on any until Wednesday at 9 a.m.

After two hours of opening statements, Rep. Carolyn Maloney (D-N.Y.) blocked a request to end a full reading of the more than 500-page bill. House clerks are required to read all legislative text out loud before a committee moves to amend it, but those readings are often unanimously waived by lawmakers to save time.

Rep. Stephen Lynch (D-Mass.), a veteran Financial Services panel member, said Democrats asked for the reading of the bill because of a disagreement over the timing amendment votes. Lynch said Democrats wanted to vote on all amendments to the bill at the end of the hearing, instead of immediately after each one was debated.

Rep. Emanuel Cleaver (D-Mo.), another panel veteran said the delay gives Democrats more time to talk up Dodd-Frank to their constituents since the Senate is unlikely to take up Hensarling’s bill. 

The reading of the bill started at roughly 12 p.m. Tuesday and lasted until roughly 3:30 p.m. Lynch said reading the full could have taken nine hours by Democratic consultation. 

Tuesday’s hearing is the latest in a series of partisan battles on the Financial Services hearing over the future of Dodd-Frank.

Republicans say it’s high time for major changes to financial regulation and insist the CHOICE Act would help reduce burdensome requirements that stifle business for smaller community and regional banks. They’ve said Dodd-Frank helps insulate big banks from competition and props them up with inappropriate and costly government guarantees.

“There is no excuse in the United States of America for 2 percent growth.” Hensarling said. “Those are American dreams that will never be realized.”

Democrats counter that the CHOICE Act would usher in a new era of harmful, risky trading on Wall Street and consider Dodd-Frank an irreplaceable tool to prevent another financial crisis.

“I’ll take 2 percent growth over the recession of 2008 any day of the week,” said Rep. Mike Capuano (D-Mass.)

The committee met last week to discuss the bill but spent most of that hearing rehashing the causes of the financial crisis and recession that prompted Dodd-Frank’s introduction.

Veteran Democrats insisted that Republican colleagues were forgetting about the cause of the 2008 crisis, arguing unsafe lending practices and risky trades caused a credit bubble to burst. Republicans countered that federal housing agencies lowered mortgage standards for the entire market, forcing banks to offer subprime mortgages at dangerous rates in order to compete.

Updated at 6:09 p.m.