Despite the bipartisan nature of the Panel's first vote last week, the new leaders of the House Financial Services Committee, Chairman Jeb Hensarling, and ranking Democrat Rep. Maxine Waters, continue to dispute the effects of the Dodd-Frank reform law.
The two leaders who stand on either side of the political spectrum were already at odds on the impact of the Dodd-Frank Act following the first vote.
"In a press release after the markup, Waters, a California Democrat, praised the 'bipartisan nature' of the vote but also proceeded to criticize a statement by Hensarling from the previous evening. In that statement, which announced subcommittee assignments, Hensarling had repeated an oft-mentioned claim by Dodd-Frank critics that the legislation 'enshrined a 'too big to fail' bailout scheme into law.'" writes American Banker's Victoria Finkle.
"Dodd-Frank specifically ends too-big-to-fail by prohibiting the bailout of a failing financial institution. In fact, it mandates the orderly liquidation of such an institution, in which its executives are dismissed and its shareholders are wiped out," Waters said objecting to Hensarling's characterization of the law. "The point of this process is to allow institutions to fail without causing catastrophic damage to the larger economy, other companies, small businesses, American taxpayers, and American families."
For the full piece see "Hensarling, Waters Already at Odds Over TBTF" (may require subscription).