The Real Obama Liberal Legacy is a periodic series to highlight the results of liberal progressivism put into practice.
Next up, Dodd–Frank. Thanks to this law’s thousands of pages of regulation, community banks have been closing their doors.
The promise: “And responsible lenders, including community banks, doing the right thing shouldn't have to worry about ruinous competition from unregulated competitors.” — President Obama, 9/14/2009.
The reality: Instead, they’re worrying about Dodd–Frank’s ruinous regulation. This legislative behemoth is over 2,300 pages long and requires federal regulators to write some 400 rules—all of which are hurting our community banks.
In fact, the number of community banks shrank by 14 percent between 2010 and 2014. There are now fewer than 6,500 banks in total, the lowest level since the Great Depression. And many services that people took for granted, like free checking accounts and small dollar loans, are in danger of being eliminated.
So what did we get out of this? Well, the law did create the Consumer Financial Protection Bureau, yet another federal agency, which can outlaw any consumer-credit product it considers “unfair” or “abusive.” Bonus: Congress has no control over CFPB’s funding, so its unelected director is unaccountable to the people.
There is a better way to protect our economy and expand opportunity. House Republicans have put out a plan to expand banking services to low-income families and to lay down clear, firm rules for job creators and workers. Learn more at better.gop.