The U.S. Senate recently passed a major rollback of some of the critical Wall Street reforms put into law eight years ago, after the worst financial crash since the Great Depression. Officially called the Economic Growth, Regulatory Relief, and Consumer Protection Act (S. 2155), the bill is perhaps better known by Sen. Elizabeth Warren derisive nickname, the Bank Lobbyist Act.
Among the reforms being trashed, there are three that particularly standout:
- Permitting big banks to engage in the kind of risky behavior that caused the 2008 financial crash;
- Enabling more predatory lending to homebuyers; and
- Reducing reporting of racial discrimination in mortgage lending.
While this bill would be disappointing on its own merits, one of the biggest surprises was that 16 Democrats in the U.S. Senate voted for it. To the extent that they tried to justify their votes, they largely cited that it would help deregulate small community banks. What they fail to mention is that, in the context of this bill, “small” means up to a quarter trillion dollars in assets. Of the 50 largest banks in the country, two thirds would suddenly become exempt from special oversight to make sure they’re not at risk of failing. To put it another way, 25 of these “small” banks are so large they have stadiums named after them.
Public Citizen members made their displeasure with this bill known, weighing in with 16,086 petition signatures, 13,964 emails to legislators and 1,860 calls opposing it.
There remains a slight hope that this law will not become law. The deregulation bill that passed last summer in the U.S. House of Representatives, the Financial Choice Act, contains significantly more lucrative handouts to bank lobbyists. The easiest course of action would be to have the House just vote on the Senate text, as-is. However, House Financial Services Chairman Jeb Hensarling, wants to push the Senate into approving something much closer to the House bill.
You can call your senators now at (202) 224-3121 and praise or criticize them for their vote. After that, you can call your representative to tell them to vote against any unwise Wall Street deregulation bill