House poised for vote to dismantle Dodd-Frank

House Republicans on Thursday are poised to pass legislation that would roll back numerous financial regulations passed by Democrats after the 2008 financial crisis.

The bill from House Financial Services Chairman Jeb Hensarling (R-Texas), known as the Financial Creating Hope and Opportunity for Investors, Consumers and Entrepreneurs (CHOICE) Act, is considered dead on arrival in the Senate, as Democrats are certain to filibuster such sweeping changes to the Dodd-Frank financial reform law.

{mosads}But passage of the measure will nonetheless be a victory for House Republican leaders, who are eager to show progress on their legislative agenda amid the larger struggles to repeal and replace ObamaCare and overhaul the tax code.

The vote will also be welcome news for President Trump, as it will come the same day as former FBI Director James Comey’s highly anticipated testimony to a Senate panel.

“This legislation comes to the rescue of Main Street America,” Speaker Paul Ryan (R-Wis.) said Wednesday at a press conference, calling the bill “the crown jewel” of the GOP deregulatory agenda. “The Financial CHOICE Act makes it possible for small businesses across this country to stop struggling and to start hiring.”

Republicans have insisted that their bill will be tougher on the financial sector by removing Dodd-Frank safeguards they say encourage risky behavior.

Trump administration officials have given the CHOICE Act a measured embrace, calling on the House to pass it, while also urging the Senate to work on changes that could clear the chamber.

The bill is expected to pass the House on a party-line vote, with Democrats opposed.

Democrats have railed against the legislation. Several veteran lawmakers called it the “worst legislation” they’ve ever seen, arguing it would strip critical financial protections and risk another crisis.

“The ‘Wrong Choice’ Act is a vehicle for Donald Trump’s agenda to get rid of financial regulation and help out Wall Street,” said Rep. Maxine Waters (Calif.), the Financial Services panel’s ranking Democrat. “It’s a deeply misguided measure that would bring harm to consumers, investors and our whole economy. The bill is rotten to the core.”

The CHOICE Act would roll back much of the Dodd-Frank regulations long targeted by Republicans. It would allow banks that reach certain cash thresholds an off-ramp from Dodd-Frank, reduce the frequency of federal stress tests and restrain oversight powers of several federal agencies that the 2010 law expanded.

Hensarling’s bill would also eliminate orderly liquidation authority — the process through which the federal government takes over and dismantles a major bank before it collapses — and place strict limits on the Consumer Financial Protection Bureau (CFPB).

The CHOICE Act would turn the CFPB, which Republicans consider abusive and unaccountable, into the Consumer Law Enforcement Agency. It would no longer control its own budget, its director would be appointed by the president, and it would lose its authority to crack down on “unfair, abusive and deceptive practices.”

Ryan and fellow congressional leaders have touted the CHOICE Act from the start. The bill was embraced as a pillar of the House Republican “Better Way” policy platform in 2016, and Ryan and House Majority Leader Kevin McCarthy (R-Calif.) have talked up Hensarling’s proposal in the run-up to the vote.

“Hensarling and the Financial Services Committee have put forth a good bill that will revive our community banks by removing burdens that prevent lending, decreasing compliance costs, and improving their access to credit and capital,” McCarthy said in a statement announcing the vote.

“Growing our economy starts with growing our communities, and for generations local banks have led the way in community investment.”

Conservative political groups also back the CHOICE Act. Heritage Action, the political arm of the conservative Heritage Foundation, said it would score lawmakers negatively for voting no, and several other right-leaning groups have endorsed the bill.

The legislation as written has little chance of passing the Senate, where Banking Committee Chairman Mike Crapo (R-Idaho) appears focused on a bipartisan measure to relieve regulations on smaller banks. With just 52 Republican senators, the GOP majority is too small to overcome a Democratic filibuster.

Hensarling said Tuesday that he’s open to negotiating the CHOICE Act with Senate colleagues and wouldn’t rule out supporting other bills to roll back Dodd-Frank. Even so, he says the ball would be in the upper chamber’s court if the legislation passes.

“[The Senate is] going to have to get something passed, and I think, increasingly, the mere fact that we would pass the Financial CHOICE Act will create greater momentum for this to get done,” Hensarling said on CNBC.

“I am willing to negotiate, but I am not willing to negotiate against myself.”