Coons & Carper Votes to Repeal Dodd-Frank Directly Linked to Bank Failures
Who could have predicted it?
THE COLLAPSE OF SVB AND THE PARTIAL REPEAL OF DODD-FRANK
Remember when Trump and the Republican leadership, in collaboration with a critical group of moderate and conservative Democrats, rolled back some of the regulations Dodd-Frank placed on regional banks? Well:
Some banking experts on Friday pointed out that a bank as large as Silicon Valley Bank might have managed its interest rate risks better had parts of the Dodd-Frank financial-regulatory package, put in place after the 2008 crisis, not been rolled back under President Trump.
In 2018, Mr. Trump signed a bill that lessened regulatory scrutiny for many regional banks. Silicon Valley Bank’s chief executive, Greg Becker, was a strong supporter of the change, which reduced how frequently banks with assets between $100 billion and $250 billion had to submit to stress tests by the Fed.
Mr. Becker, who had been on the San Francisco Fed’s board of directors, was no longer on the board as of Friday, a Fed spokesperson said.
The new “Republican populism” has the same policy agenda as Paul Ryan.
Meanwhile, another example of “every libertarian is a socialist if they and/or their buddies make a bad investment”
Coons and Carper were the only “Blue State” Democrats to support Trump’s vandalism.
Why 17 Democrats voted with Republicans to ease bank rules
The Senate voted 67 to 31 on Wednesday to ease regulations on all but the largest banks, in what would become the biggest rewrite of financial laws since the Dodd-Frank reform act passed after the global financial crisis. The legislation would raise the level at which banks are considered “systemically important” and exempts smaller banks from other rules aiming to curb risky behavior.
Critics objected to a provision raising the threshold for an institution to be considered “too big to fail” to $250 billion in assets from $50 billion in assets, arguing it opens taxpayers up to more potential liability should a mid-sized institution fail. Under the bill, the entities below $250 billion in assets would no longer have to go through a “stress test” to prove they can survive a crisis. Some Democrats also criticized a provision related to mortgage data that they say will make it harder for the government to target discriminatory or predatory lenders.
It is unclear if the GOP-majority House will seek to pass the legislation or a more drastic rollback of bank rules that Senate Democrats would be reluctant to support.
The bank legislation left Democrats balancing competing concerns as they battle for control of Congress in November. Some members of the party have long argued smaller banks and lenders in rural areas should face fewer restrictions. Several Senate Democrats like Heidi Heitkamp of North Dakota face re-election in November in states President Donald Trump won in 2016 and have tried to create an appearance of supporting bipartisan or moderate policies.
On the other hand, progressive Senate Democrats like Elizabeth Warren of Massachusetts warned against passing the bill, arguing it would apply to too many banks and damage efforts to protect consumers after the financial crisis. Ahead of November’s midterms, Democrats want to cast themselves as better defenders of workers and consumers than Republicans.
Voting on the bill largely reflects the midterm political realities. The Democrats running in safer seats this year tended to oppose the bill, while the lawmakers in races that election handicappers consider close were more likely to back the plan.
Ten of the 17 Democrats who voted for the plan will run for re-election this year. Seven of them — Heitkamp, Joe Donnelly of Indiana, Claire McCaskill of Missouri, Jon Tester of Montana, Joe Manchin of West Virginia, Debbie Stabenow of Michigan and Bill Nelson of Florida — face tough races in states Trump carried.
“You can’t blame [Senate Minority Leader Chuck] Schumer for not wanting to twist the arms of red-state Democrats against home-state banking interests,” former Schumer aide and Hillary Clinton advisor Brian Fallon told The Associated Press. “But from the standpoint of the larger party messaging, it’s a missed opportunity to not strike a bright-line contrast on behalf of consumers.”
Sens. Sherrod Brown of Ohio and Bob Casey of Pennsylvania, who also face re-election in states Trump won this year, notably opposed the bank plan. Both lawmakers appear to have an easier path to a November win than Democrats in more heavily Republican states like North Dakota.
The bill exposed fault lines among Democrats ahead of the midterms. In recent tweets, Warren hit her Democratic colleagues who supported the plan, saying it “wouldn’t be on the path to becoming law” without her party.
Heitkamp told the AP “I came here to represent North Dakota, and that’s exactly what I’m doing.” She argued the bill “will make a huge difference for rural America.”
Not just the vulnerable Democrats up for re-election this year backed the proposal. Sen. Doug Jones, who won a special election in deep-red Alabama last year, supported the bill. He will face another election in 2020.
Both senators who represent safe blue Delaware, Chris Coons and Tom Carper, backed the plan. The banking industry has a strong presence in the state.
Translation our little “business friendly” politicians are setting the stage for yet another “Banking Crises”. We know what is needed, the end of Carper and Coons and for that matter all politicians that are in the pocket of the banks. In the mean time bet on more bank failures, and bet that the net result will be that we will lose as the rich are “made whole” by the politicians.
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