New progressive sheriffs in town ready to fight for Main Street
- Protecting democracy from corruption;
- raising wages;
- rebuilding America’s infrastructure;
- combating climate change;
- bringing down high prescription drug prices;
- restoring civil rights;
- combating the deconstruction of government;
- reviving antitrust;
- securing financial stability;
- combating the threat of recession:
These are just a few of the refreshing new priorities that the U.S. House of Representatives under the leadership of Speaker Nancy Pelosi (D-Calif.) and a bold new freshman class are bringing to Washington, D.C.
While these agenda items will move forward across a wide range of committees, it may surprise some that the House Financial Services Committee has a significant role to play in securing many of these priorities.
Take climate change, for example. Long-term investors have been clamoring for additional transparency and accountability from America’s public companies (and, increasingly, from the private ones too).
These investors need to understand what the threat of extreme weather, natural disasters, flooding, ocean acidification, crop collapse and more will mean for the economy and for their investments. They are not only prepared to, but need to, deploy their capital to manage and mitigate those risks.
Yet insufficient transparency and accountability in America’s capital markets are not making that possible, dragging down efficiency and growth prospects, not to mention hurting fishermen, farmers, ranchers, low-income Americans living near rivers and the coasts and, frankly, the entire economy.
The Securities and Exchange Commission has been wrestling for years with whether and how to boost environmental, social and governance disclosures. It’s time to act, and the House Financial Services Committee can lead the way.
But it’s not just climate change. Providing greater transparency about how companies employ and train workers, their diversity practices, their human rights impacts, their tax compliance and, of course, political spending are all essential aspects of accountability to the public and long-term market efficiency for investors.
- stripped by payday lenders and unscrupulous banking practices;
- reduced by brokers who don’t act in the best interests of their customers or banking entities that bet against their clients; and
- wrongfully taken by racially discriminatory practices and forced arbitration that denies victims access to courts.
This all occurs in contravention of laws and rules put in place by the Wall Street reforms after the 2008 financial crisis.
But rather than fighting for working families, Trump’s regulators have been deconstructing their agencies, gutting enforcement and rolling back those rules to protect consumers and investors. Through oversight, legislation and public accountability, the House Financial Services Committee can show there’s a new sheriff in town.
Across the new House agenda, the Financial Services Committee will play an important role in advancing common sense progressive priorities. Whether it’s:
- building infrastructure by maintaining a strong municipal bond markets;
- countering corruption by boosting enforcement of the Foreign Corrupt Practices Act and corporate disclosure;
- securing civil rights by restoring anti-discrimination enforcement for lending and entrepreneurial opportunities for communities of color;
- bringing down high prescription drug prices by boosting oversight of private equity practices;
- reviving antitrust by countering financial sector concentration;
- securing financial stability through strong financial system regulation; or
- combatting recessions through oversight of monetary policy oversight, the committee’s sweep is broad.
These exciting priorities stand in stark contrast to the financial services agenda that had been in place for far too long. Since 2010, the GOP-controlled House has used the committee to cater to Wall Street’s needs, an agenda which gained steam when Trump entered office.
They passed countless bills to water down, dismantle or outright repeal enormous swaths of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
At the top of the list was:
- eliminating or defanging the Consumer Financial Protection Bureau (CFPB), which has returned $12 billion to 29 million consumers since it opened its doors in 2011;
- gutting the Volcker Rule, which separates banks that served customers from trading operations that took big bets in the markets;
- watering down oversight of the $600 trillion swaps market, which spectacularly failed in 2008; and
- undercutting the capital protections that ensure banks absorb their own losses rather than seek taxpayer bailouts.
The GOP-led committee also sought to gut key housing programs for working families, like the 30-year fixed rate mortgage, as well as protections against racial redlining in credit. Who they were fighting for was all too clear —and recognized by the voter in 2018.
New Committee chairwoman Maxine Waters (D-Calif.) laid out her agenda at the Center for American Progress Action Fund last week, placing many of these principles front and center to the committee’s work over the next two years.
Chairwoman Waters is a progressive leader who has dedicated her life to public service and improving the lives of American families across the country, and especially people of color. Her creation of a subcommittee dedicated to diversity and inclusion on Wall Street and in regulators is groundbreaking.
Together with the exciting addition of newly elected members like Cindy Axne (D-Iowa), Alexandria Ocasio-Cortez (D-N.Y.), Katie Porter (D-Calif.), Ayanna Pressley (D-Mass.), Rashida Tlaib (D-Mich.) and others, the committee has an opportunity to put a lasting mark on building an economy that creates opportunity for all working people.
Ultimately, the committee’s task is to ensure government and the financial system serve working families and drive the long-run goals of a productive, equitable and green economy. This is no small task, but it’s the heart of their mandate. And it’s essential.
Andy Green is managing director for economic policy at the Center for American Progress Action Fund.