HomeUS News updateWarren and Porter unveil bill to repeal Trump bank law

Warren and Porter unveil bill to repeal Trump bank law

WASHINGTON – A group of Democrats led by Sen. Elizabeth Warren of Massachusetts and Rep. Katie Porter of California will unveil legislation Tuesday to restore bank rules that were undone in 2018 under then-President Donald Trump, those that It is said that he was demanding to be rectified. The collapse of Silicon Valley Bank.

The legislation, first reported by NBC News, would repeal the centerpiece of legislation passed on a bipartisan basis by the Republican-led Congress in 2018 that imposed Dodd-Frank financial regulations on banks by raising the “too big to fail” threshold. Made it easy From $50 billion to $250 billion in assets.

“In 2018, I rang the alarm bells about what would happen if Congress rolled back critical Dodd-Frank protections: Banks would load up on risk to inflate their profits and collapse, threatening our entire economy — And that’s exactly what happened,” Warren said. “President Biden called on Congress to strengthen regulations for banks, and I am proposing legislation to do just that by repealing the core of Trump’s bank law.”

The Warren-Porter bill would restore limits established in 2010 for increased capital requirements and stress tests to prevent future failures at SVB and Signature Bank last week.

According to Warren’s office, the legislation will be formally introduced with a group of original co-sponsors — including Sens. Tammy Baldwin, D-Wis., and Bob Casey, D-Pa, who are both re-elects in competing states. face the election. 2024, as well as Reps. Pramila Jayapal, D-Wash., chair of the Progressive Caucus, and Ro Khanna, D-Calif., who represents SVB’s district, and Sen. John Fetterman, D-PA, who serves with Warren on the Banking Committee.

Porter, who is running for the Senate seat held by Sen. Dianne Feinstein in a crowded race against several prominent House Democrats, said the bill would “restore the railings of common sense that keep corporate greed in check and our financial system in check.” Restores trust.”

Representative Katie Porter speaks during a roundtable discussion in Huntington Park, Calif.
Representative Katie Porter.Robert Gauthier / Los Angeles Times via Getty Images File

Another co-sponsor of the bill is Rep. Ruben Gallego, D-Ariz., who is running for the Senate seat held by Sen. Kirsten Sinema, I-Ariz.; Sinema voted for the 2018 legislation when she was a member of the House, while Gallego opposed it.

The new bill is likely to spark a split between Democrats in a fight dating back to 2018. At the time, Warren pressured senators to stop the GOP-led appropriations bill, but 17 Democrats voted with Republicans, giving them enough support to break the filibuster and pass it. Proponents argued that many small and medium-sized banks were being hit by increased regulations passed in the wake of the 2008 financial crisis and could do better without them.

Among the banks affected by the easing of regulations in the Trump-era measure was Silicon Valley Bank, which joined an array of medium and community banks lobbying for that relief at the time. The Warren-Porter bill would not repeal the entire 2018 law, but rather its core — Title IV, called “Treasuring Regulations for Certain Bank Holding Companies” — which set asset limits for which banks were subject to federal scrutiny. .

Some Democratic supporters of the 2018 law, including Sen. Mark Warner of Virginia, say it sets an appropriate level of regulation over mid-sized and community banks.

Sen. Jean Shaheen, D.N.H., who voted for the 2018 bill, said Tuesday that she stands by her vote.

“I think it’s early. We need to complete the investigation into what really happened at Silicon Valley Bank. All the regulation in the world isn’t going to fix bad management practices, and it appears this is the case with SVB.” is one of the problems,” Shaheen said. “But based on the result, I think it’s fair for us to take a look at what we did and see if it still holds up.”

The failure of the SVB has reopened the debate on financial regulation. It’s unclear whether the Warren-led bill can get the 60 votes needed to move forward in the Senate. And if it does, it will be a tough sell in the House, which is controlled by Republicans who voted for the deregulation measure in 2018.

Republicans are not blaming bank failure on lack of regulation: California House Speaker Kevin McCarthy Tweeted President Joe Biden’s spending on Tuesday led to “record inflation and rapid interest rate hikes that broke household budgets and even banks.”



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