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According to a report released on Sunday Night by the Wall Street Journal, Republicans in the House of Representatives are set to mark the four year anniversary of the controversial Dodd-Frank financial reform act with a 100 page report highlighting its perceived failures. Chief among those failures is the fact that the law did not accomplish its purported goal of ending the prospect that banks are “too big to fail.
"In no way, shape or form does the Dodd-Frank Act end too big to fail,'" House Financial Services Chairman Jeb Hensarling (R-Texas) said in a written statement.
The GOP report criticizes the law for, among others things, giving consumers a false sense of security to invest in non-bank servicers by designating them as “systematically important”, creating the illusion that the government would bail them out if the need arose because they too are too big to fail.
Non-bank servicers have come under increased scrutiny from the federal government in recent weeks.
Supporters of the law contend that it has worked. Among the accomplishments, supporters say that it made the environment safer by forcing big banks to carry larger capitol levels and giving regulators the authority to seize and liquidate a financial failing financial firm if doing so would be in the best interest of the greater economy.
Representative Maxine Waters (D-Callifornia), the top Democrat on the House Financial Services Committee, said in a written statement that Dodd-Frank "has provided much-needed oversight to Wall Street, given regulators the tools to end the era of 'too big to fail' entities and taxpayer bailouts and put a new federal agency on the front lines of protecting consumers from bad actors in the financial system."
Republicans contend that these reforms have done more harm than good and left both consumers and banks in the dark as they contend with the confusion of mountains of untested new regulation.
