All eyes in Washington were on FBI Director James Comey last Thursday, but the story that will actually have an effect on Americans wasn’t happening in the Senate – it was across the hall in the House of Representatives. It was there that congressional Republicans managed to pass a bill to repeal the economic disaster that has been the Dodd-Frank banking regulations. And if the Senate and the president can get this repeal passed into law, it could be the single-biggest factor in the economic boom to come.
By a vote of 233-186 – thanks a lot, Democrats! – the House passed the Financial Choice Act, which will put the nightmare of Dodd-Frank in the rearview mirror. That law, which was signed by President Obama after the bottom fell out of the banking industry, put said industry under crippling regulations that kept the economy stagnant long after the recovery should have been completed. It has not lived up to any of the liberal promises, except that we haven’t had to bail out the banks since its passage. But to attribute that to these regulations would be an exercise in fiction.
Instead, Dodd-Frank has stifled innovation and made it almost impossible for banks to compete. This has led to higher costs for consumers, more consolidation at the top of the banking industry, and the rapid disappearance of smaller banks throughout the United States. Worse, it hasn’t made investing or getting a loan any more safe for the average American. It’s only made it more difficult, more exclusive, and more expensive. These factors have conspired to keep the economy from taking off, leaving many financial analysts to wonder if this is as good as it’s going to get.
Democrats are going to try and stop this bill by any means necessary when it gets to the Senate. The progressive wing of the party, led by liberal superstars like Bernie Sanders and Elizabeth Warren, think that Dodd-Frank is not only a good law but that it should be only the tip of the iceberg when it comes to Washington’s stranglehold over the private sector. Hell, if you got these people off the record, they would probably tell you that we should get rid of the banks altogether and just put Congress in charge of all mortgage loans. Or, for that matter, just get rid of loans altogether and have the government provide every American with one free house and car when they turn 18.
To get the economy booming again, we have to let the free market actually BE the free market. What Republicans did Thursday puts us on the road to doing just that.