Republicans don't seem to remember the devastating recession that encompassed the country less than a decade ago. On Thursday, the majority-GOP House voted to undo major parts of the 2010 financial regulation legislation that President Obama signed into law. The move amounts to a repeal of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and if successful, could have serious repercussions for the economy.
The GOP's Financial Choice Act passed the House 233-186 along party lines, with the argument that repealing the bill is necessary for the growth of the economy. "The Dodd-Frank Act has had a lot of bad consequences for our economy, but most of all in the small communities across our country," House Speaker Paul Ryan argued at a press conference.
What it actually does, though, seems to be different. If the Financial Choice Act is signed into law, the bill would remove some oversight of banks, let Congress limit the effectiveness of the Consumer Financial Protection Bureau, and allow President Trump to fire key players in government agencies working in the financial industry.
Lisa Donner, executive director of Americans for Financial Reform, explained to The New York Times what the passage of the bill would mean to everyday Americans. "It would make it easier for predatory lenders to rip people off," Donner told the newspaper. "It would make it easier for big Wall Street banks to take the kind of risks in pursuit of short-term gains that go directly to the pockets of the tiny handful of people at the top that led to the financial crisis."
House Financial Services Chairman Jeb Hensarling, the mastermind behind the bill, told reporters after it passed that "every promise of Dodd-Frank has been broken." He also took to reading letters from those who had been turned down for loans.
"We will replace economic stagnation with a growing healthy economy," he added, seemingly unaware of the 75 straight months of job growth under President Obama that resulted in 11 million new jobs total. Or that the Dow Jones Industrial Average had gone up by 140 percent during Obama's presidency.
Even the Neoliberal New Democrats voted against the Financial CHOICE Act pic.twitter.com/QywJRWwbF0— Dave Weigel (@daveweigel) June 8, 2017
The biggest changes that you would notice on a personal level only apply if you're among the poorest of Americans. As the Southern Poverty Law Center argues, the Consumer Financial Protection Bureau, which would be in danger of congressional defunding (and the head of whom could be fired by Trump) is one of the few agencies that protects the poorest from predatory financial organizations.
A senior staff attorney, Sara Zampierin, explained what this means to some vulnerable communities. "Predatory loans are devastating to low-income communities. Millions of economically disadvantaged people fall deeper and deeper into a nightmare of debt after taking out payday and car title loans to pay for food, rent, utility bills or other basic needs," she wrote in a statement.
Dodd-Frank might not be perfect, but it is one of the few financial protections afforded to individual Americans. Senate Republicans must think twice before adopting the current plan from the House.