Sen. Tim Scott [1], Ranking Member of the Senate Committee on Banking, Housing, and Urban Affairs, has announced a framework for his legislative proposal to revitalize a critical pillar of the U.S. economy and to open up capital markets to all Americans. The Ranking Member’s framework for the Empowering Main Street in America Act [2] will boost avenues for capital formation that create jobs and generate economic growth across America.
The Empowering Main Street in America Act is designed to empower, support, and foster growth by providing streamlined access to funding through the U.S. capital markets system, which can be used to innovate, job create, and accelerate economic growth. The legislation would return the Securities and Exchange Commission (SEC) to its primary focus on ensuring the engines of the U.S. capital markets system are primed to fuel the next chapter of American exceptionalism, instead of putting up new and burdensome hurdles that limit opportunity, drive new investors out of markets, and chill innovation and competition.
Note that the exact verbiage does not exist as of yet for the Empowering Main Street in America Act, as Sen. Scott will consult with industry stakeholders and those on the frontlines to draft the exact wording of the bill.
“Our capital markets are the global gold standard and help make the strength of the American economy the envy of the world—but they shouldn’t be limited to elites on Wall Street or industry giants in California and New York,” said Sen. Scott. “All Americans should be able to invest amounts of their choosing in order to grow wealth and build their communities, and our small business owners should be able to access funding in the same way large corporations do. This framework makes substantive changes to our capital markets system that will provide Americans across the country, including those who are often left behind, with the tools to achieve financial security and the American Dream.”
Sen. Tim Scott, Ranking Member of the Senate Committee on Banking, Housing, and Urban Affairs
While many small businesses nationwide accounted for 66% of employment growth over the past 25 years, however most entrepreneurs report access to capital as a major barrier to their company’s survival. The goal of the Empowering Main Street in America Act is to address the challenges that small businesses face and foster their growth.
Key goals of the Empowering Main Street in America Act include:
- Promoting greater capital formation in public and private markets: In order to help entrepreneurs, small businesses, and newly public companies more easily access the funding necessary to expand their operations and create jobs, the Empowering Main Street in America Act will streamline and modernize the rules governing capital raises for public and private markets. This begins with ensuring the current regulatory environment doesn’t disproportionately impact small businesses’ ability to raise funding.
- Responsibly expanding investment opportunities for retail investors: The Empowering Main Street in America Act will seek to increase opportunities for everyday investors to build wealth and help American businesses access new sources of capital by responsibly expanding the definition of who can qualify as an accredited investor.
- Fostering investor confidence in market integrity, fairness, and transparency: Markets that operate fairly and safely benefit all investors. The Empowering Main Street in America Act seeks to understand and address the barriers that currently limit Americans’ participation in our capital markets and provides the public, financial institutions, and state and local governments tools to better identify, prevent, and prosecute financial crimes.
- Holding regulators accountable through increased oversight: The Empowering Main Street in America Act ensures more consistent transparency and accountability to Congress and the public by extending the oversight provisions authorized undern the Dodd-Frank Act to mandate the SEC Chair to testify on a semi-annual basis and to statutorily require the SEC to perform thorough rulemaking cost-benefit analysis.
Click here [2] to read a fact sheet on Sen. Scott’s Empowering Main Street in America Act.