Sen. Crapo's Dodd-Frank Reform Bill: Important, Commonsense Step Toward Relief for Small Banks

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This week, the U.S. Senate is expected to vote on Senator Mike Crapo’s bipartisan Dodd-Frank reform bill, “Economic Growth, Regulatory Relief, and Consumer Protection Act” (S.2155). The Competitive Enterprise Institute (CEI) supports reforms in this bill that would bring regulatory relief to small banks. CEI experts note that although these reforms are a step forward, there is still more that needs to be done.

CEI policy analyst Daniel Press:

“It’s encouraging that in such a polarized political environment, Republicans and Democrats are willing to work together on commonsense banking reform. While Dodd-Frank was supposed to tackle “Too Big to Fail,” in reality it made thousands of banks across the country “Too Small to Succeed.” Since Dodd-Frank, community bank compliance costs have risen to an average of 24 percent of net income, and as a result, more than one in five banks have disappeared. Reforms in this bill would help right-size these regulatory costs, and allow small banks to get back to growing businesses and supporting local economies.”

CEI senior fellow John Berlau:

“S. 2155 is a good first step, but Congress needs to do more to free Main Street consumers, investors, and entrepreneurs from red tape limiting their choices and opportunities. Congress must also reform the structure of the Consumer Financial Protection Bureau to make it accountable to the American people under the Constitution, by placing its funding under congressional appropriations and giving the U.S. president the authority to remove the director if needed. Regulators also need to use their authority under the law to lift barriers to entrepreneurship and innovation, while at the same time protecting Americans from fraud. All it takes for the American economy to soar is for regulators to stand back and give businesses the freedom to fail and succeed.”

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