The Financial CHOICE Act Is the Wrong Choice

Wall Street sign by Chris Li

From rejection of the Paris Climate Accords to rejection of financial safeguards that were put in place following the 2008 financial crisis, US policies are increasingly a threat to people and the planet.

On June 8, 2017, the House of Representatives voted along party lines, 233-186, to roll back vital financial protections in the Dodd-Frank Wall Street Reform and Consumer Protection Act. These protections are needed to:

  • Protect millions of Americans, through the Consumer Financial Protection Bureau, from financial ruin due to abusive, fraudulent, and deceptive financial products and services;
  • Safeguard our economy from excessive Wall Street risk-taking – especially as taxpayers are expected to bail out banks that fail;
  • Allow average investors – not only the very largest — to bring issues of concern before corporate management and other investors using the shareholder resolution process.

The vote on the Financial CHOICE Act of 2017, HR 10, was clearly a choice to further enrich and empower the wealthiest at the expense of the public’s well-being. It is a poor choice for the long-term economic health of our country.

Green America mobilized our members to oppose the bill which represents a major set-back to the green economy we work to build. Key protections under attack by Republicans were put in place following the 2008 financial crisis in order to prevent the recurrence of that economic nightmare for our nation. The Dodd-Frank provisions have certainly helped our nation – and need to be further strengthened, not repealed. The Dodd-Frank protections have limited excessive speculation by the mega-banks; reigned-in unscrupulous mortgage lenders; and tackled problems with payday lenders that purposefully trap people in debt.

A number of Republicans have cast their opposition to the Dodd-Frank reforms as being hurtful to small banks. But rather than work constructively to make any needed changes, they seek to dismantle the protections for all of us — except Wall Street. Interestingly, Republicans are not interested in revisiting, let alone dismantling, regulations that they have promoted that hurt small banks. Why not revisit money-laundering and Patriot Act provisions that small banks struggle with?

Another problem with the Financial CHOICE Act is its goal of taking away the power of all but the largest investors. The shareholder engagement process with corporate management, in place through the Securities & Exchange Commission, has served our nation well since 1934. The number of shareholder resolutions filed on social and environmental issues has grown over the years, thanks to engagement by concerned investors. They force Corporate America to confront its impacts on human rights, worker rights, climate change, environmental issues, the advancement of women and minorities, corporate political spending and lobbying, and many other issues. Republicans would limit the shareholder resolution process to a handful of the very largest investors. And no surprise — they have not been the ones to champion social, environmental, and corporate governance improvements at companies.

Members of Congress who supported this “wrong Choice” Act are giving megabanks and predatory lenders the green light to financially exploit hard-working Americans, further expanding the chasm between the rich and the majority. Green America advises the Senate to defeat this short-sighted bill based on Wall Street greed, not a green economy for all of us. All Green Americans should contact their Senators to urge them to uphold and strengthen the Dodd-Frank financial protections; support the Consumer Financial Protection Bureau; and maintain the current shareholder resolution process to hold companies accountable on their social, environmental, and corporate governance impact.

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