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Blog: Dodd-Frank Dilemma


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I was more than a little annoyed recently during a committee hearing with a government official who seemed intent on defending an agency created by the troubling Dodd-Frank Act that is more interested in navel gazing than helping our nation's small businesses.

During the hearing, a leading deputy at the Consumer Financial Protection Bureau (CFBP), created by Dodd-Frank, was unable to justify exactly what this so-called consumer protection agency has actually achieved on behalf of consumers. After two years, the official provided me with vague answers as to the group's actual accomplishments.

The situation was even more exasperating for me because, in the two years since the passage of Dodd-Frank, I have heard over and over again from citizens and business owners who are frustrated with the legislation. Dodd-Frank was supposed to address the causes of the 2008 financial crisis that rippled through every part of our economy. Instead, we have a 884- page law that doesn't address the root causes of the crisis -- for example, it never even mentions Fannie Mae and Freddie Mac -- but is making life a lot more difficult for Main Street by drowning our small business owners under 400 new rules and mandates and restricting access to credit.

Clearly, this bill has done more to harm Main Street than fix Wall Street and the CFPB is one of those glaring reasons why. Designed to implement and enforce financial consumer law to ensure all consumers have access to consumer financial products and that services are fair, transparent and competitive, the CFPB cannot show that it actually has done any of that. In fact, it is making credit harder to come by, which makes it harder for businesses to expand, grow, and hire. CFPB also specifically places consumer protection ahead of safety and soundness of financial institutions. I am all for strong consumer protections, but as a former bank regulator for our state, I know firsthand that putting safety and soundness of the banks and credit unions that hold your deposits behind other priorities is the wrong way to go.

With unemployment still at an astounding 8.2 percent, it is even more important than ever that Congress repeal job-killing parts of Dodd-Frank that will help to create a sense of certainty again. I believe that the CFPB is part of the problem, not the solution, when it comes to creating an environment in which our small businesses can succeed.

In my opinion, Dodd-Frank is proving to be yet another example of onerous and costly rules on folks and burdening small businesses with unnecessary mandates that hinder our nation's number one job creators from creating much-needed jobs. It's not often that I agree with Treasury Secretary Tim Geithner, but I think he got it right when he said of Dodd-Frank: "We need to recognize Dodd-Frank as a dangerous dead-end."

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