Rules panel clears Dodd-Frank rewrite for House vote

The House Rules Committee on Tuesday night cleared for a vote on the House floor a Republican effort to strip much of the Dodd-Frank Act.

The powerful panel — the last stop for every bill considered by the House — cleared the Financial CHOICE Act 9-4 along party lines and with few amendments. The full House is scheduled to vote on the bill by Friday morning, and it is expected to pass it without Democratic support.

The CHOICE Act is an effort to roll back Dodd-Frank, long panned by Republicans as a burden on the U.S. economy and businesses. The bill, sponsored by House Financial Services Committee Chairman Jeb Hensarling (R-Texas), passed that panel earlier this month with unanimous Republican support and unified Democratic opposition.

“It’s time to help small businesses. It’s time to make Washington and Wall Street accountable,” Hensarling said at the hearing. “We have way too much capital sitting on the sidelines of this economy.”

Rules Committee members approved few changes to the bill beyond an updated version introduced by Hensarling. The amendment removed a provision to scrap a controversial cap on fees charged to retailers by credit card companies, placed the National Credit Union Administration under the congressional appropriations process, and mandated greater classified information sharing between federal financial regulators and Congress.

Hensarling’s bill would allow banks to opt out of Dodd-Frank if they hold enough in cash reserves, and it would limit federal stress tests of major banks to every two years. The bill would remove the power through which the federal government can label a bank “too big to fail” and take it apart before a collapse.

The CHOICE Act would also put major restraints on the Consumer Financial Protection Bureau, long considered unaccountable and redundant by Republicans.

The bill would strip the CFPB of its independent agency status and control of its own budget. The bureau would be renamed the Consumer Law Enforcement Agency, and would be run by a director appointed by the president. Its budget would be controlled by Congress, meaning a GOP-controlled government could try to defund it entirely to effectively eliminate the agency.

Democrats who’ve fiercely defended Dodd-Frank have railed against the CHOICE Act, insisting it would dismantle key regulations protecting American consumers and risk another financial crisis.