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Elizabeth Warren Blasts Fellow Democrats for Supporting a Massive Bank Deregulation Bill
“The Senate just voted to increase the chances your money will be used to bail out big banks again.”
HANNAH LEVINTOVAMAR. 6, 2018 6:00 PM
https://www.motherjones.com/politics/2018/03/elizabeth-warren-blasts-fellow-democrats-for-supporting-a-massive-bank-deregulation-bill/
The US Senate on Tuesday cleared a key procedural hurdle needed to move forward with a major bank deregulation bill that could pass the chamber in the coming days. If it becomes law, the bill would significantly loosen Wall Street regulations that were put in place by the landmark 2010 Dodd-Frank legislation following the financial crisis.
“This bill wouldn’t be on the path to becoming law without the support of these Democrats.”
One of the major changes proposed in the bill is a provision that would shrink the number of big banks that, under Dodd-Frank, are subject to additional scrutiny designed to assess their ability to withstand financial shocks—in essence, extra checks to determine how likely the banks are to fail or to require a government rescue with public dollars. Currently, banks with at least $50 billion in assets are subject to the additional supervision. The Senate bill would quintuple that threshold, meaning that banks would not receive added scrutiny if they have less than $250 billion in assets. The Congressional Budget Office released an analysis on Tuesday warning that such a change could have serious consequences. The bill, notes the CBO, would “increase the likelihood that a large financial firm with assets of between $100 billion and $250 billion would fail.”
If this threshold change becomes law, several dozen major banks and financial institutions—including BB&T, American Express, Credit Suisse, Regions Financial, Citizens Financial, and SunTrust—would no longer be subject to the most rigorous checks, and the total number of financial institutions under the highest level of oversight would drop from 40 to about 12. Additionally, the CBO found that the bill would grow the deficit by at least $671 million between 2019 and 2027, and would slightly increase the possibility of another financial crisis.
Despite this CBO analysis, the bill appears to be on course to sail through the Senate, in part because it has garnered support from a sizable number of Democrats. On Tuesday, Sen. Elizabeth Warren (D-Mass.)—one of the original champions of Dodd-Frank—criticized Democrats who voted to advance the current bill. “This bill wouldn’t be on the path to becoming law without the support of these Democrats,” she wrote on Twitter. “The Senate just voted to increase the chances your money will be used to bail out big banks again.”
“This bill wouldn’t be on the path to becoming law without the support of these Democrats.”
One of the major changes proposed in the bill is a provision that would shrink the number of big banks that, under Dodd-Frank, are subject to additional scrutiny designed to assess their ability to withstand financial shocks—in essence, extra checks to determine how likely the banks are to fail or to require a government rescue with public dollars. Currently, banks with at least $50 billion in assets are subject to the additional supervision. The Senate bill would quintuple that threshold, meaning that banks would not receive added scrutiny if they have less than $250 billion in assets. The Congressional Budget Office released an analysis on Tuesday warning that such a change could have serious consequences. The bill, notes the CBO, would “increase the likelihood that a large financial firm with assets of between $100 billion and $250 billion would fail.”
If this threshold change becomes law, several dozen major banks and financial institutions—including BB&T, American Express, Credit Suisse, Regions Financial, Citizens Financial, and SunTrust—would no longer be subject to the most rigorous checks, and the total number of financial institutions under the highest level of oversight would drop from 40 to about 12. Additionally, the CBO found that the bill would grow the deficit by at least $671 million between 2019 and 2027, and would slightly increase the possibility of another financial crisis.
Despite this CBO analysis, the bill appears to be on course to sail through the Senate, in part because it has garnered support from a sizable number of Democrats. On Tuesday, Sen. Elizabeth Warren (D-Mass.)—one of the original champions of Dodd-Frank—criticized Democrats who voted to advance the current bill. “This bill wouldn’t be on the path to becoming law without the support of these Democrats,” she wrote on Twitter. “The Senate just voted to increase the chances your money will be used to bail out big banks again.”
13 replies
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How quickly these ppl forget the past boggles the mind. How in the world could anyone think this would be a good thing? ..the cycle continues!
Thanks for the tip. 