The proposed House Financial CHOICE Act will guarantee economic growth while replacing the Consumer Financial Protection Bureau, which has hurt consumers in many cases, the bill's author, Rep. Jeb Hensarling, said Tuesday.
"What it does is it guarantees economic growth for all; bank bailouts for none," the Texas Republican, who chairs the House Financial Committee, told MSNBC's "Morning Joe" program.
"The best form of consumer protection is competitive, innovative transparent markets that are vigorously policed for force and fraud."
The CFPB has caused a great deal of harm, Hensarling insisted, and if his bill passes, the bureau will be replaced "with the Consumer Law Enforcement Agency, that is there to actually enforce our roughly two dozen major federal consumer protection laws."
The CFPB, however, is "making up the law," Hensarling said.
"Since it has come into fruition, we've seen free checking at banks cut in half, bank fees are up, credit cards have 15 percent fewer offerings that cost 200 base points more, and mortgages cost $100 more to close and are harder to come by," he commented. "This particular agency, which is perhaps the most unactable and powerful agency, has hurt consumers."
Meanwhile, when asked if he believes something had to happen following the financial crash of 2008, Hensarling said he believes that the deregulation move was a myth.
"It wasn't so much a matter of deregulation, it was a matter of dumb regulation," said Hensarling of Dodd-Frank, as the regulations gave banks the incentive to loan money to people to buy homes they could not afford.
"I don't think can you make the case we needed more complexity in our system," said Hensarling.
"Dodd-Frank has broken all of its promises. It said it would lift the economy and yet we continue to be stuck in a 1.5 percent to 2 percent GDP growth economy. It said it would bank bailouts but it codified them into law. It said it would make our financial system more stable but the big banks are actually bigger.
"And the small banks are fewer, losing one a day. Last but not least, it said it would help the consumers but in many cases consumers are worse off. We've had seven years of Dodd-Frank. It has failed. We need economic growth for all bank bailouts. The answer is more capital, not more regulation."
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