Doug Sword

Rules Readies Financial Services, Interior-Environment Bill
McHenry files only GOP leadership amendment

The House Rules Committee recommended a rule Monday that would allow 87 amendments to be heard when the House turns to floor debate of the combined fiscal 2019 Interior-Environment and Financial Services spending bill this week.

Among the amendments will be a Republican provision to bar the U.S. Postal Service from expanding its offering of banking services. But an amendment to provide $380 million in grant funding to states to beef up election security, pushed repeatedly by Democrats citing Russian meddling in the 2016 election, didn’t make the cut.

Proposals Would Help Homeowners, Make Ex-Presidents Pay for Office Supplies
Financial Services spending bill amendments also could affect local post offices

Local post offices would be barred from offering most banking services, homeowners with crumbling foundations would get some help and ex-presidents would have to pay for their own office supplies under proposals to amend the House’s fiscal 2019 Financial Services spending bill.

Proposed amendments also include some of the usual suspects: keeping the District of Columbia from enforcing certain local laws, allowing federally insured banks to take deposits from companies in the marijuana industry, and barring federal funds from being spent at properties owned by President Donald Trump.

House Panel Advances Bills Aimed at Helping Small Businesses
Rep. Maxine Waters calls bills approved Wednesday an example of “true bipartisanship”

The House Financial Services Committee on Wednesday approved a group of bills designed to make it easier for small companies to raise capital and relax regulations for investors, or potentially set the stage to make it easier.

Four of the bills would call for studies or reports.

Battle Over Consumer Financial Protection Bureau Leadership Ending
Challenge to Mick Mulvaney dropped

Leandra English has indicated she will leave her position at the Consumer Financial Protection Bureau this week, ending a legal contest over the directorship of the bureau that has been an ongoing political drama in Washington since the day after Thanksgiving.

In tweets on Friday, English said she would be “stepping down from my position” at the bureau, and her attorney, Deepak Gupta, said that English would drop her appeal of a federal judge’s denial of her motion for a permanent injunction. The injunction she sought would have barred Acting Director Mick Mulvaney from running the agency and instead installed English in the top spot.

Despite New CFPB Nominee, Mulvaney Could Be Around a Long Time
Observers see the pick as a strategic move to extend his tenure

Democrats could play into the White House’s hand if they plan to delay President Donald Trump’s pick to lead the Consumer Financial Protection Bureau, experts say.

The White House announced Saturday that the president intends to nominate Kathy Kraninger, who is currently an associate director of the Office of Management and Budget, where Mick Mulvaney is the director.

Bank Group Plans Midterm Ads, Starting With Tester, Budd
Six-figure ad buys on the way in Montana and North Carolina

The American Bankers Association said Wednesday it would weigh into midterm congressional campaigns for the first time with independent expenditure TV ads, beginning with “six-figure” buys in Montana and North Carolina.

“These ads are a concrete example of our stepped-up political engagement efforts,” American Bankers Association President Rob Nichols told hundreds of bankers at the association’s government relations conference in Washington Wednesday.

‘Lenny the Loan Shark’ Leads Opposition to Payday Rule Repeal
Democrats gearing up for one of the biggest fights of the spring

What do Mick Mulvaney, Sens. Lindsey Graham and Richard J. Durbin, Lenny the Loan Shark and progressive groups have in common?

They all appear to be prepping for what is likely to be one of the biggest political fights of the spring — the attempt to repeal the Consumer Financial Protection Bureau’s controversial payday lending rule using the Congressional Review Act.

Podcast: Banking Deregulation in the Air
CQ on Congress, Episode 95

CQ banking reporter Doug Sword explains the state of play as Republicans (and some Democrats) try to relax banking regulations enacted during the Obama administration to safeguard against a repeat of the 2008 financial meltdown.

Senate Passes Bank Deregulation Bill, House May Seek Additions
More than a dozen Democratic senators joined all Republicans

The Senate voted Wednesday to pass a bill that would be the biggest bank deregulation since 1999 and would roll back parts of the 2010 Dodd-Frank financial overhaul.

More than a dozen Democrats joined the Republicans to pass the bill, sending it to the House, where conservative Republicans may seek to attach further provisions to roll back the 2010 law. Republicans will be trying to straddle the line between the extensive reversal of bank regulation that they seek and keeping on board the Senate Democrats who will be needed to clear the measure.

Fed Chairman Weighs in on Financial Deregulation Bill Set for Senate Debate
Senate set to consider measure on the floor next week

Federal Reserve Chairman Jerome Powell used his first appearance before the Senate Banking Committee to endorse the main features of a financial deregulation bill that the Senate is set to debate on the floor next week. 

Powell told the panel Thursday that the “most significant” provision in the bill is the replacement of the Dodd-Frank threshold for stringent Fed regulation of banks. The 2010 Dodd-Frank law put the threshold at $50 billion in assets. The bill would raise that to $250 billion, and reduce the number of banks effected from 44 to 13.

Senators Rebuke GSA, FBI Over Handling of FBI Headquarters
Abrupt abandonment of years-long process to relocate miffs lawmakers

Republican and Democratic senators on Wednesday blasted the General Services Administration and the FBI over costs, press leaks and changes in security requirements in its redrawn plan for a new FBI headquarters.

Senate Environment and Public Works Chairman John Barrasso complained at a hearing that senators learned of the GSA’s abrupt cancellation of a previous FBI plan last year through press reports rather than from the agencies. He also cited the missed deadlines on that plan, which had been more than a decade in the making.

Senate Banking Panel Advances Fed, Two Other Financial Nominees
Economics professor Marvin Goodfriend endorsed for Federal Reserve Board

The Senate Banking Committee narrowly endorsed Thursday the nomination of Marvin Goodfriend to the Federal Reserve Board as Democrats complained that the economics professor is more focused on fighting inflation than creating jobs.

Goodfriend faced opposition from Democrats because of what they described as a lack of commitment to the Fed’s goal of supporting maximum employment. His nomination advanced on a party-line vote of 13-12.

Steven Mnuchin Mostly Meh on Market Drop
Treasury secretary says Russia sanctions are on the way

Treasury Secretary Steven Mnuchin told lawmakers Tuesday that he’s unworried about the sharp drop in equity markets in recent days and noted the stock market is still much higher than it was at the start of the Trump administration.

Mnuchin also said President Donald Trump would be able to appoint a regulator next year for Fannie Mae and Freddie Mac, the government sponsored mortgage giants, adding that the official would have the power to unilaterally curtail affordable housing programs backed by Democrats.

Latest Wells Fargo Penalties Add Fuel to Dodd-Frank Debate
Democrats fret that banks will get off easy under new Federal Reserve leadership

Democrats are praising former Federal Reserve Board Chair Janet Yellen’s actions against Wells Fargo & Co. and questioning whether the Fed will continue to be as tough now that she has left the central bank.

The Fed’s cease-and-desist order released Friday evening, on Yellen’s final day as chairwoman, restricts the nation’s third-largest bank to the $1.95 trillion in total consolidated assets it had at the end of 2017, a move the company estimates will cut its earnings this year by between $300 million and $400 million. The company had a net income of $22.2 billion in 2017.

Higher Education Bill Expected in Senate Soon
“I see a consensus emerging that is student focused,” Alexander says

The top Republican and Democrat on the Senate Health, Education, Labor and Pensions Committee appeared Thursday to agree on a number of provisions they would like to see in a new bill to reauthorize the Higher Education Act, which would streamline student loans.

Chairman Lamar Alexander of Tennessee said at a hearing that he hopes to have a Senate version of the reauthorization ready “by early spring.” A House reauthorization bill was approved by the Education and the Workforce Committee on a 23-17 party-line vote in December.

Senate Banking Advances Powell Nomination for Fed Chairman
Sen. Elizabeth Warren only senator to vote against recommendation

The Senate Banking Committee voted 22-1 Tuesday to recommend confirmation of Jerome Powell as the next chairman of the Federal Reserve. Massachusetts Sen. Elizabeth Warren voted against the recommendation.

Powell received the support of Chairman Michael D. Crapo, who had voted against him during his renomination to the Fed board in 2014.

Garrett’s Jabs at Export-Import Bank May Stop His Bid to Lead It
The former N.J. congressman once voted against reauthorizing the bank

Former New Jersey Rep. Scott Garrett faces an unusual combination of Democrats and business groups opposing his nomination to lead the Export-Import Bank as the Senate hearing on his confirmation approaches.

Garrett, who lost his bid for re-election in 2016, is part of the wing of the Republican Party that sees the Ex-Im Bank’s loan, insurance and guarantee programs as corporate welfare that mainly benefits large companies. He was a founding member of the hard-line conservative House Freedom Caucus. 

At Equifax Hearings, Senators Complain of Deja Vu
It’s ‘long past time’ Congress set standards for data security, Grassley says

Senate Judiciary Committee members voiced exasperation about holding another hearing on whether consumers’ personal information is secure as Richard Smith, the former CEO of Equifax, made his third congressional appearance in two days to explain a security breach that allowed hackers to gain access to personal data — names, Social Security numbers, birth dates, addresses and some driver’s license information — on more than 145 million consumers. 

Judiciary Chairman Charles E. Grassley of Iowa said Wednesday that it is “long past time” that Congress set standards for data security, adding that he was “committed to getting a good bill ... over the finish line.”

Democrats Exclude CFPB in Faulting Regulators of Wells Fargo
Currency comptroller, Federal Reserve and FDIC criticized

A House Democratic report on Wells Fargo’s fraudulent creation of millions of bank and credit card accounts faulted the oversight of regulators including the Office of the Comptroller of the Currency, the Federal Reserve and the Federal Deposit Insurance Corporation.

But the report released Friday by Democratic staff on the House Financial Services Committee didn’t blame the Consumer Financial Protection Bureau for flaws in the investigation or enforcement at Wells Fargo, the nation’s second-largest bank by market capitalization.

Military Groups Join Democrats’ Defense of Arbitration Rule
‘We will not accept a future where our military veterans’ financial protections are chipped away’

Service member and veterans groups on Wednesday criticized a Republican effort to overturn the Consumer Financial Protection Bureau’s rule barring mandatory arbitration in many consumer contracts. 

The groups joined Sen. Jack Reed, D-R.I., ranking member of the Senate Armed Services Committee and a member of the Senate Banking Committee, to oppose Senate Republicans’ plan to pass a measure that would repeal the CFPB rule. The rule took effect Monday, but the agency is giving companies until March 2018 to comply.