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House votes to roll back post-2008 financial rules

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House votes to roll back post-2008 financial rules

"The Wrong Choice Act is a vehicle for Donald Trump's agenda to get rid of financial regulation and help out Wall Street", said Representative Maxine Waters (D-CA), the ranking Democrat on the Financial Service Committee. Banks with assets of $50 billion or more would be required to undergo "stress tests" every two years instead of annually, as the current law requires. "This law may have had good intentions, but its consequences have been dire for Main Street", House speaker Paul Ryan said in a statement. Numerous regulations that were created in response to the financial crash have hindered economic growth, including Dodd-Frank and the decision to put Fannie Mae and Freddie Mac under government conservatorship.

"That is a highly sensitive issue with Democrats, and [the Republicans] need 60 votes". The Dodd-Frank Act, which Republicans say is strangling the financial industry, was passed in the wake of the 2008 financial crisis. "For the goal of making the financial system safer, hyou can do a lot more of that with less complex and less burdensome regulation", said Kim Schoenholtz, director of the Center for Global Economy and Business at NYU Stern.

Senate Majority Leader Mitch McConnell (R-Ky.) said last month that he was not optimistic about making changes to Dodd-Frank. One Republican voted against the measure.

The legislation would also weaken the powers of the Consumer Financial Protection Bureau. House Financial Services Committee chairman Jeb Hensarling of Texas says the bill would make it easier for consumers to borrow. The bill, sponsored by Hensarling, passed 233 to 186, with all but one Republican, Rep. Walter Jones (N.C.), backing it and every Democrat opposing it.

The Consumer Federation of America denounced the measure as "a deregulatory wish-list from special interests that repeals numerous significant achievements in the Dodd-Frank Act".

"But what has happened is we've seen a tremendous concentration among the big banks", Rothfus said. It has become a target of the Republican Party and the administration, with the president arguing in April the regulations "fail to hold Wall Street firms accountable".

"We will make sure there is needed regulatory relief for our small banks and credit unions, because it's our small banks and credit unions that lend to our small businesses that are the jobs engine of our economy and make sure the American dream is not a pipe dream", Hensarling added.

Rep. Steve Knight (R-Lancaster) also supported the bill, saying on Thursday, "The Financial CHOICE Act will allow small businesses to grow by expanding vital access to capital".

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