Deregulation Bill May Hurt Many Americans
The Financial CHOICE Act, also known as the Deregulation Bill has been passed by the House and is making its way to the Senate for further consideration.
For those who are unfamiliar with this, the Deregulation Bill, soon to be known as the Financial CHOICE Act (Creating Hope and Opportunity for Investors, Consumers, and Entrepreneurs) was created to:
- End taxpayer bailouts
- Require Wall Street accountability through augmented penalties for fraud and deception
- Eliminate the ‘too big to fail’ concept
- Refom the CFPB as means for Americans to achieve financial independence
- Attain economic growth through competitive, transparent, and innovative capital markets
These are only a few of the many key principles proposed through the Deregulation Bill. Though it may look good on paper and the idea of financial freedom sounds extremely enticing, this new act can have a severe effect on many Americans.
The Problem With The Proposal
Once passed by the Senate and approved by the President, The Financial CHOICE Act would eradicate many, if not all, of the banking reforms that were implemented after the financial crisis of 2007-2008.
More specifically, this bill will dismantle the Dodd-Frank reforms that were enacted in response to the U.S’s financial crisis. The Dodd-Frank Wall Street Reform and Consumer Protection Act created regulations for the financial industry in the efforts to avoid another collapse that was reminiscent of the Lehman Brothers. Generally, Dodd-Frank allowed Americans to better attain mortgages and loans without being subjected to ‘abusive lending’ from banks (Source). Not only would The CHOICE Act void the Dodd-Frank Act, it would roll back all of the rulings that were put in place by the Consumer Financial Protection Bureau (CFPB) in accordance with the financial collapse.
There are many facets to The CHOICE Act that have the potential to negatively affect Americans and their businesses. A prime example being the limitations that will be placed on public access to information; something that will have a direct impact on businesses nationwide.
This is a generation in which we heavily rely on the advice and experiences of others before we make a final decision of our own. In many instances, we implement this mindset when looking for a good place to eat, or a reputable business to hire for a variety of services. We look closely at Google Review, Yelp, Trip Advisor, Angie’s List, Consumer Reports, Better Business Bureau, and more to further educate ourselves in making a decision that will best suit our needs. When you really think about it, how can one find a decent restaurant, a respected mechanic, a prestigious contractor, or a dependable financial service without the help of online consumer reviews? Of course, it’s essential to remember that you can’t believe everything that you read, but the point of these reviews is to provide others with information to make their own decision on.
In everything we buy, in any place we go, in any service we hire, consumer reviews aids us in making an informed decision. And The CHOICE Act is about to make that decision even harder, especially in the case of financial services.
The conservatives within the House of Representatives seem ready to enact the prohibition of the publishment of data the government collects on consumer reviews of financial services. Why you may ask? Well, in theory, in an effort to shut down the complaint portal. But what The CHOICE Act has neglected to acknowledge, is that along with helping individuals, this data has the ability to produce insights for policymakers and businesses to examine (Source).
Some even use this data to better their business in the future. So, by eliminating this data, The CHOICE Act is not helping the business, they are hindering it from positive reviews or the opportunity to use the complaints to improve their business. With financial services, reliability is the key, and without published data, Americans are left second guessing their options.
With all the issues that this act has the potential to create, could we instead dub this bill as the Wrong Choice Act?