Dodd-Frank didn't have a chance with so much focus being cast upon the James Comey hearings. While the bill has now faced its biggest challenge at the hands of representatives in the House, there's still legislation to be handled in the Senate. Should the same legislation be passed there, the odds skyrocket that Wall Street will be back to their old ways sooner rather than later.
Rolling back Dodd-Frank
As the eyes of the world focused on Comey and his testimony, the House got to work in rolling back Dodd-Frank. With a party line vote, the bill passed due to the Republican-majority legislature.
Called the "Financial CHOICE Act," the bill seeks to eliminate or drastically reduce the restrictions placed on Wall Street following the 2008 financial crisis. House Financial Services Committee Chairman Jeb Hensarling, a representative from Texas, led this particular piece of legislation.
The bill is nearly 600 pages long, according to NPR. One of the most important tenets of the bill is the elimination of the Volcker Rule - that regulation prevents government-insured banks from partaking in dangerous bets with investments. The bill would also take away some of the authority of the Consumer Financial Protection Bureau, which was created by Dodd-Frank to monitor giant banks and keep payday lenders in line.
Overall, the passing of this new bill would favor Wall Street and likely hurt consumers.
Legacy of Dodd-Frank
Overall, the legacy of Dodd-Frank will go down as being a mixed bag. Even former Representative Barney Frank, whose name makes up half of the bill, claimed that mistakes were made in regard to the original legislation.
He also said that the bill harmed small banks more than intended. Many people believe that, if there is to be regulation in the financial sector, it has to be more flexible than Dodd-Frank, which rigidly regulated banks.
The original bill is not dead yet, however. Senate Democrats are gearing up for a fight when the Financial CHOICE Act lands on their desks.
The bill won't have the votes in the Senate if it goes strictly on party lines, which has caused similar legislation to fail in the past. Dodd-Frank is on life support, but this is the same process through which much of the legislation until the 2018 midterm elections will live or die. When Comey is no longer in the news, this bill will likely take the spotlight and be on the minds of both those in the media and the general population.
