James Setterlund

ATR Leads Coalition Letter Supporting Rep. McHenry’s Amendment in FSGG Appropriations

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Posted by James Setterlund on Wednesday, July 18th, 2018, 9:30 AM PERMALINK

Americans for Tax Reform led a coalition letter expressing support for an amendment to the Financial Services and General Government appropriations bill sponsored by Congressman Patrick McHenry (R-NC) that would bar taxpayer dollars from going to the post office expanding its presence in the financial services sector, as well as prohibiting the creation of any pilot programs for postal banking made between USPS and organized labor.

Supporters of postal banking argue that bank branch closures in recent years leave underserviced consumers without access to financial services, however, FDIC data has shown there are nearly 90,000 bank branches in the U.S., three times more than that of post offices. With that, their massive data breach in 2014 compromised the private information of 2.9 million customers. USPS failed to protect the Social Security Numbers of millions, and certainly shouldn’t be trusted with their financial information.

Proponents also assert that allowing USPS to expand their banking services would quell some of their financial woes, yet their entry into the market would only further exacerbate their problems. Considering USPS has failed to turn a profit for 12 consecutive years, questions are raised whether the Post Office can effectively execute their duties of delivering first class mail, let alone entering the private market of banking. This is an especially concerning matter for taxpayers who will foot the bill for a bailout when the postal banking venture likely fails.

Americans for Tax Reform led the coalition letter to support the amendment, which can be found here and below.

 

July 18, 2018

Dear Congressman Patrick McHenry

On behalf of our organizations and the Americans we represent, we write to express support of your Amendment to Division B, within the Financial Services and General Government section of H.R. 6147. This amendment would prohibit the use of any taxpayer funds for postal banking and financial services and prohibit the creation of any new pilot program that would expand this business practice through collective bargaining. 

While the USPS serves an important role in delivering mail and packages, we are concerned about expanding the Postal Service’s primary role and allowing the government to compete with the private sector. This would include lower fees, subsidized services and even competing based on real estate and office location. 

Consideration of expanding postal operations to engage in banking and financial services is not a new concept. It has been touted as a solution to help stabilize the US Postal Service’s financial practices. The cost alone to hire additional workers and retrain existing employees to offer banking products would further undermine the Postal Service’s budgetary issues. 

Additionally, we have reservations about the ability of the Postal Service to safeguard customers’ identities and information such as bank accounts and passwords. Regardless of the federal agency, the government has shown it can be slow to react to cyber threats, allowing bad actors to access citizens’ private records. 

It is clear the US Postal Service’s financial health is troubling. Expanding USPS’s operations to compete with private sector banks and credit unions is not the answer. We, the undersigned organizations, support your amendment to H.R. 6147 and encourage its inclusion in the final appropriations legislation. 

Sincerely,
 

Grover G. Norquist
President, Americans for Tax Reform

Tim Chapman
Executive Director, Heritage Action

Tom Schatz
President, Council for Citizens Against Government Waste

Adam Brandon 
President, FreedomWorks

Brandon Arnold
Executive Vice President, National Taxpayers Union

Kevin Kosar
Vice President of Policy, R Street Institute 
 

Andrew F. Quinlan
President, Center for Freedom and Prosperity


Iain Murray 
Vice President for Strategy and Sr. Fellow, Competitive Enterprise Institute

 

Photo Credit: Shannon McGee


ATR Opposes H.R.1611, the Gender Diversity in Corporate Leadership Act of 2017

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Posted by James Setterlund on Tuesday, July 10th, 2018, 2:20 PM PERMALINK

ATR President Grover Norquist sent a letter to Financial Services Chairman Jeb Hensarling (R-Texas) and Ranking Member Maxine Waters (D-Cal.) expressing his strong opposition to Rep. Carolyn Maloney’s (D-N.Y.) Gender Diversity in Corporate Leadership Act, H.R.1611.

Maloney’s legislation would task the SEC with the creation of a ‘Gender Diversity Advisory Group’ to “study strategies for increasing gender diversity among the members of issuers' boards of directors.” Additionally, HR 1611 would provide the SEC with rule making authority to require additional information already publicly available with the threat of enforcement if companies choose to alter their current practices of providing this information in their proxy statements to shareholders.

Maloney and fellow Democrats ignore the fact that the composition of board members is publicly available information and commonly voted on by shareholders. Their political virtue signaling is nothing more than attempt to open the door for government involvement in the social responsibility of private enterprise. As is the case with the SEC collecting information on the compensation of CEOs as a result of Dodd-Frank.

This kind of activist agenda being pushed may actually have a negative impact on shareholders return on investment, to whom the CEOs and boards of directors have a fiduciary responsibility to protect. In a 2014 Harvard Law report, the authors explain how the reliance on proxy firms’ recommendations for executive compensation can influence how corporate boards act and decrease shareholder value.

If the company and their shareholders agree and choose to put forward efforts to promote social causes ahead of their return on investment, they do so at their own discretion. In no way should bureaucrats at the SEC be in the businesses of compelling companies to engage in these practices for fear of punishment.

The proposed legislation takes the SEC wildly out of their purview of regulating securities markets, protecting against fraud and abuse from bad actors and will waste valuable time and resources. When a door opens, government has a tendency to go through the door, and remain in the marketplace, making it harder to be reversed. Congress should keep this door closed and vote against Rep. Maloney’s legislation.

The full letter can be found here and below.

 

July 10, 2018

 

The Honorable Jeb Hensarling, Chairman
House Committee on Financial Services
2129 Rayburn House Office Building
Washington, D.C. 20515
 

The Honorable Maxine Waters, Ranking Member
House Committee on Financial Services
2129 Rayburn House Office Building
Washington, D.C. 20515
 

Dear Chairman Hensarling and Ranking Member Waters:
 

I write in strong opposition to H.R. 1611, the Gender Diversity in Corporate Leadership Act of 2017. This legislation falls well outside the intended purpose of the Securities and Exchange Commission’s mission and does nothing to protect investors.

Under Dodd-Frank’s “Miscellaneous Provisions,” or Title XV, there has been a concerted push by some in Congress to compel the SEC to become an activist agency by forcing companies to disclose mine safety violations, resource extraction in countries abroad and “conflict minerals originating in the Democratic Republic of the Congo.” Instead, the agency has to dedicate staff and resources to monitoring these issues instead of properly using staff to oversee financial markets and protect against fraud as intended with its creation.

This legislation in essence adds to Title VX of Dodd-Frank by continuing the practice of inserting the government in between private enterprises and their shareholders. Additionally, this provides the SEC with rule making authority to require additional information already publicly available with the threat of enforcement if companies choose to alter their current practices of providing this information in their proxy statements to shareholders.

I am concerned that H.R. 1611 also leaves the door open for future legislation that would further obligate the SEC, or any other government agency, to engage in social rule making and demand companies to adopt practices that decrease shareholder value for political purposes.

If companies wish to engage in practices that promote social causes, it should be for them to decide, free from government intervention. For these reasons, I urge members of this Committee to vote against H.R. 1611 and I encourage free market supporters to do the same.

Sincerely,
 

Grover G. Norquist
President
Americans for Tax Reform

 

Photo Credit: Securities and Exchange Commission


ATR Leads Coalition Letter Supporting Elimination of Office of Financial Research

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Posted by James Setterlund on Monday, July 9th, 2018, 12:00 PM PERMALINK

ATR led a coalition letter expressing support for legislation by Congressman Ted Budd (N.C.-13) and Alex Mooney (W.V.-2) that would eliminate Dodd-Frank’s Office of Financial Research (H.R. 5470).

As a result of the 2008 financial crisis and the Dodd-Frank Wall Street Reform and Consumer Protection Act, legislators created the Office of Financial Research (OFR) to examine the systematic risk in financial markets.

Its independent Director serves a six-year term and is given unilateral power under Dodd-Frank to collect the data and spending habits of Americans. Essentially, OFR can force banks to turn over data and consumer information by exercising its own subpoena authority.

By design, Congress handicapped any oversight of the agency by allowing it to set its own budget as it is funded outside of the traditional appropriations processes, removing Congressional “power of the purse” authority. While not funded by tax dollars, it’s instead funded by fees imposed on banks, which goes to paying the agency’s small 300 personnel who aren’t even subject to the typical civil-service salary caps.

Agencies like the Federal Reserve, Securities and Exchange Commission, Commodities and Futures Trade Commission, Federal Deposit Insurance Corporation, and other agencies, have legions of economists that have been doing the same research as OFR before and after its creation.

OFR’s existence only serves to hurt American consumers. Realizing this and OFR’s massive invasion of consumer privacy, unaccountability, ineffectiveness, and waste, Congressman Ted Budd and Alex Mooney introduced H.R. 5470. Their bill would eliminate the OFR completely by striking any mention of it from Dodd-Frank.

Americans for Tax Reform led the coalition letter to supporting this legislation, which can be found here and below. 

 

July 9, 2018
 

Dear Congressmen Ted Budd and Alex Mooney,
 

On behalf of our organizations and Americans we represent, we write to express support of your legislation, H.R. 5470. This legislation will eliminate the Office of Financial Research, a duplicative department created from Dodd-Frank and without congressional oversight.

In response to the financial recession Congress passed Dodd-Frank, creating a myriad of new rules, regulations and agencies. One of these agencies is the independent Office of Financial Research, with the mission of collecting and analyzing data and risk toward financial markets. OFR is funded outside the appropriations process, and instead receives its funding through fees collected from predominantly bank holding companies and some non-financial companies. In order for the agency to have access to this data, Congress granted OFR sweeping authority to collect information from the companies that fund it, including regulatory agencies, using subpoena power.

This legislation would eliminate OFR and therefore its redundancies as an agency. OFR’s objective of analyzing data already exists within roughly 20 other agencies, departments, bureaus, committees and federal sectors, most notably within the Department of the Treasury, the Federal Deposit Insurance Corporation and the Federal Reserve. H.R. 5470 would also place the Financial Stability Oversight Council under the appropriations process as the Council currently receives their operating expenses for OFR.

We, the undersigned organizations, support H.R. 5470 and its underlying provisions to eliminate a redundant agency created from Dodd-Frank.

 

Sincerely,
 

Grover Norquist
President, Americans for Tax Reform
 

Brent Wm. Gardner
Chief Government Affairs Officer, Americans for Prosperity
 

Adam Brandon
President, FreedomWorks
 

John Berlau
Senior Fellow, Competitive Enterprise Institute
 

Tom Schatz
President, Council for Citizens Against Government Waste
 

Pete Sepp
President, National Taxpayers Union

 

Photo Credit: Office of Financial Research


House Passes and President Trump Will Sign Bank Regulatory Relief Bill

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Posted by James Setterlund on Wednesday, May 23rd, 2018, 9:19 AM PERMALINK

On Tuesday, the House passed S. 2155, the Economic Growth, Regulatory Relief, and Consumer Protection Act with a bipartisan vote of 258-159. 33 Democrats joined Republicans in rolling back parts of Dodd-Frank that have burdened community banks, regional banks and credit unions since it was signed into law eight years ago. President Trump will sign the bill into law, marking a milestone in reforming the nation’s financial laws.

In typical Washington fashion, Congress reacted to the financial crisis with sweeping laws and regulation that spanned the financial sector, that touched large and small financial firms. Many of these smaller players played no role in the 2007 – 2009 crisis yet had new rules that regulated them as if they had. Dodd-Frank’s new regulations increased compliance costs for banks and credit unions which resulted in many of them no longer offering free bank accounts and cut access to small business loans and home mortgages.

ATR has been supportive of S. 2155 and has championed the legislation that will jump start consumers access to affordable financial services. In a letter of support for the legislation, ATR’s President Grover Norquist called this a step in the right direction.

It is also important to mention House Financial Services Committee Chairman Jeb Hensarling, who has spent much of his term as chairman of the committee working to reform Dodd-Frank. Chairman Hensarling has championed legislation that removes Washington bureaucrats from standing in between consumers financial choices. Senate Banking Chairman Mike Crapo (R-Idaho) also deserves applause for bringing together both Democrats and Republicans to pass legislation benefitting all constituents across the US. Chairman Crapo played an integral role in passing S. 2155 in the Senate this past March with a vote of 67-31.

ATR is pleased to see this legislation become law as President Trump is expected to sign S. 2155 before Memorial Day weekend. President Trump made Dodd-Frank reform a principal of his campaign and reaffirmed his pledge when he said, “we’re doing a real number on it.” This is a step in the right direction toward rolling back this burdensome regulatory law and ATR looks forward to continuing to support pro-growth legislation that reforms Dodd-Frank.

Photo Credit: Senate Banking


ATR Op-Ed in The Hill Encourages Congress to Eliminate Payday Loan Rule

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Posted by James Setterlund on Tuesday, May 15th, 2018, 11:52 AM PERMALINK

ATR’s Matthew Adams wrote an op-ed for the The Hill encouraging Congress to use the Congressional Review (CRA) to remove the CFPB's payday loan rule that was finalized this past October. The overbearing regulation limits the number of loans that can be taken out at a given time and forces the borrower to disclose their income, borrowing history, and financial obligations. This unnecessarily complicates the process and precludes two-thirds of loans made by lenders. 

Adams wrote that the Obama-era rule spelled disaster for low-income Americans who are underbanked as the rule prevents them from getting access to capital when they need it:

"The short-term loans act as a cash advance that are paid back in full at the borrower's next pay period. Their convenience is essential for consumers as many banks are unwilling to engage in these types of transactions as the little return on fees is not enough to offset compliance costs. While not for everyone, they’re crucial for many who live paycheck to paycheck, and especially for those who have difficulty qualifying for other types of credit."

Adams noted that the CRA allows Congress to rollback regulations from executive agencies within 60 legislative days:

"The window in which Congress can use the CRA to overturn this rule is expected to expire at the end of this week. With time ticking, it is paramount that Congress moves to relieve American consumers from this unnecessary and heavy-handed regulation."

To read more of Adams’ op-ed, click on the direct link to The Hill.

Photo Credit: Frankie Leon


Following Senate, House Moves to Overturn Another Obama-era Financial Rule

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Posted by James Setterlund on Tuesday, May 8th, 2018, 5:30 PM PERMALINK

Today, the House of Representatives voted 234-175 to overturn a Consumer Financial Protection Bureau rule that used severely flawed research methods to determine if consumers faced discrimination when purchasing vehicles. This vote is an important step toward rolling back Obama-era rules that have limited Americans access to capital and choice in the marketplace.

When Dodd-Frank was passed in 2010, it specifically blocked the newly created CFPB from regulating auto dealers. In 2013, then CFPB director Richard Cordray deceitfully went around Congress by issuing a guidance document that reclassified auto finance lenders as “creditors” when financing a loan for a consumer to purchase a vehicle.

While auto dealerships are forbidden from collecting ethnic identifiable information like race or gender, the CFPB used the names of consumers and their addresses to guess based on where they lived if they were discriminated against. Internal Bureau documents show that even staff were concerned about these methods. Regardless, the CFPB targeted businesses using these suggestive findings in an effort to extort them for millions of dollars.

In 2017, Sen. Pat Toomey (R-PA.) asked the Government Accountability Office if the “guidance” the CFPB issued on auto lending practices qualified as practical guidelines or as a “rule” based on the enforcement capability of the document. At the end of last year, the GAO determined that the guidance did qualify as a rule and is subject to the Congressional Review Act; an expedited process that allows Congress to vote for or against regulations with only a majority vote required.

ATR’s President Grover Norquist has questioned this flawed rule and its reliance on discriminatory data collection methods:

Today’s House vote shows that under the previous administration, the independent Bureau with its single director and unaccountable structure to congressional appropriations and oversight can be weaponized to target businesses for financial settlements. It is astonishing to see so many Democrats who vote against a resolution that clearly shows Richard Corday and the CFPB ignored the will of Congress mandated in Dodd-Frank to punish auto lenders who had nothing to do with the recession but who have been extorted for millions that could have been better used to lower interest rates for consumers.

The Senate voted last month on Sen. Jerry Moran’s (R-Kan.) resolution S.J.Res. 57, in a vote of 51-47 with one democrat joining republicans. ATR looks forward to President Trump signing the resolution and rolling back this destructive rule promulgated under the previous administration.

 

Photo Credit: Ted Eytan


ATR Op-Ed in The Hill Urges Acosta Not to Appeal Fiduciary Ruling

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Posted by James Setterlund on Wednesday, April 11th, 2018, 12:20 PM PERMALINK

ATR’s Matthew Adams wrote an op-ed for The Hill encouraging Secretary of the Department of Labor, Alex Acosta, not to appeal the 5th Circuit Court of Appeals recent ruling that vacated the Department’s fiduciary rule.

As Adams noted, this rule was imposed during the Obama administration, encompassed over 1,000 pages and put unelected Washington bureaucrats in between customers saving for retirement and financial professionals:

"The 1,000-page regulation was created with the intent of eliminating supposed conflicts of interest between financial advisors and clients. Even in its short implementation, it negatively affected how advisors gave advice to IRA and 401(k) customers planning for their future. The American Action Forum found that the rule would have increased consumer costs by $46.6 billion or $816 annually per account."

Adams showed how financial professionals will move away from servicing accounts typically under $25,000 because of regulatory compliance costs, which punishes customers who are saving for retirement:

"Under the scope of the rule, financial professionals like broker-dealers, insurance agents, appraisers, and others who gave advice or guidance but otherwise had no real influence over a financial portfolio were considered to be fiduciaries, and therefore held to fiduciary liability. As noted in one study, 35 percent of advisors surveyed said they would stop servicing low-balance accounts typically under $25,000, and that one-fourth would increase their current client minimums."

To read more of Adams' op-ed, click on the direct link to The Hill.

To read ATR’s letter to Secretary Acosta urging him to not appeal, click here

Photo Credit: Source


ATR Urges Secretary Acosta Not to Appeal Fiduciary Ruling

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Posted by James Setterlund on Wednesday, April 11th, 2018, 6:36 AM PERMALINK

 

Americans for Tax Reform released a letter encouraging Department of Labor Secretary Alex Acosta to not appeal the recent court ruling from the 5th Circuit of Appeals which vacated the Department’s fiduciary rule.

The full letter can be found here and below.

 

April 11, 2018

The Honorable Alexander Acosta
Secretary
Department of Labor
200 Constitution Avenue, N.W.
Washington, D.C. 20210
 

Dear Secretary Acosta:

On March 15 the Fifth Circuit Court of Appeals vacated the Department of Labor’s (DOL) fiduciary rule finding that the agency had exceeded its statutory authority under the Employment Retirement Income Security Act of 1974 (ERISA). I encourage you to direct the Department of Justice to not appeal the Court’s ruling as the ruling is a strong victory for consumers, investors and retirement planners.

Roughly two years ago in April 2016, the Department of Labor finalized its fiduciary rule; a one-size-fits-all approach to defining the “best interest” standard for investment professionals and their clients. The rule will greatly reduce the ability of financial advisors to give advice to IRA and 401(k) customers with one report noting that 35 percent of advisors surveyed “will move away from low-balance accounts” or accounts with less than $25,000 in assets. Additional estimates show the rule could disqualify up to 7 million IRA holders from seeking advice and reduce new IRA openings by hundreds of thousands annually.

Additionally, I have emphasized the importance of this lawsuit brought forth by a coalition of business groups seeking to block this misguided Obama era rule. Americans for Tax Reform has supported congressional efforts to roll back the Department’s rule using the Congressional Review Act and stop DOL from writing a similar rule in the future. Unfortunately, President Obama vetoed the resolution and kept in place a rule that places Washington in between savers and planning for retirement.

With the Court’s recent decision, this marks a significant opportunity to leave an Obama era regulation right where it belongs – with the previous administration. I encourage you to let the Court’s decision stand and protect consumers access to affordable retirement services.

 

Sincerely,

Grover G. Norquist
President
Americans for Tax Reform
 

 

 

Photo Credit: Wiki Commons


Senate Passes Crapo's S. 2155 to Reform Dodd-Frank Regulatory Burden

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Posted by James Setterlund on Thursday, March 15th, 2018, 1:46 PM PERMALINK

Last night, the Senate voted 67-31 to pass Chairman Mike Crapo’s (R-Idaho) Economic Growth, Regulatory Relief, and Consumer Protection Act (S. 2155) to reform the regulatory environment created under Dodd-Frank that has hindered small business’s access to capital and consumers access to mortgage products while exempting community banks and credit unions from overregulation.

Dodd-Frank was a signed into law by former President Obama to “rein in Wall Street” after the 2007-08 financial crisis. However, as typical of sweeping regulatory legislation, Dodd-Frank ended up benefiting large banks and only served to hurt community banks, credit unions, and the consumers in general.

In a letter of support written by ATR’s President, Grover Norquist wrote: 

S. 2155 provides much needed relief to community and regional financial institutions while jumpstarting small businesses and hopeful homeowners access to capital. While there is still more work to be done, it is a positive step in the right direction, and we are encouraged by the Senate to continue to work and reform Dodd-Frank.

Chairman Crapo’s legislation demonstrates his thoughtful approach to reforming financial regulation while promoting economic growth; a goal that started early in 2017 with his committee soliciting reform proposals from industry and outside organizations. ATR has been supportive of S. 2155 and sees this as a strong step in the right direction toward removing barriers to capital for consumers and small businesses.

Photo Credit: Jazz Guy


Treasury Secretary Mnuchin Praises Sen. Crapo’s Bipartisan Banking Bill

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Posted by James Setterlund on Monday, February 5th, 2018, 1:45 PM PERMALINK

Last week, Treasury Secretary Steve Mnuchin appeared before the Senate Banking, Housing and Urban Affairs Committee to discuss the Financial Stability Oversight Council’s annual report to Congress, of which Secretary Mnuchin is the chairperson. In his opening statement to the committee, Secretary Mnuchin offered praise for Committee Chairman Mike Crapo’s bipartisan legislation, the Economic Growth, Regulatory Relief and Consumer Protection Act (S. 2155), calling it a “thoughtful approach that better aligns our financial system to support economic growth in our communities.”

For starters, Secretary Mnuchin is right, this bill will ease the regulatory burden for small and midsize financial institutions that provide mortgage lending services to lower income Americans and those in rural communities. The bill also makes it easier for smaller financial institutions to engage in market making activities if the institutions are below $10 billion in assets in conjunction with additional leverage ratios. Perhaps the most discussed portion of the legislation is Title IV, which will increase the threshold in which bank holding companies are subject to enhanced regulation from the current $50 billion in assets to $250 billion in assets. The bill also provides a path for banks between $100 billion to $250 billion in assets to be exempt from regulatory red tape after 18 months of the enactment of the bill or sooner.

While this is an important step toward reforming Dodd-Frank and increasing consumer’s access to capital, the legislation has two areas that could be improved. First, larger financial institutions that provide services to millions of Americans do not have the ability to obtain regulatory relief in this legislation. Like the small and mid-size institutions, the larger financial institutions spend a significant amount of money on regulatory compliance when much of that spending could be better used in the hands of consumers and in the marketplace.

The bill also mandates credit reporting agencies to offer customers credit monitoring services “free of charge”, while industry competitors are not subject to this mandate. Simply put, these are private industries whose services are not the governments to give away. A government mandate like this will stifle both innovation and competition in the credit monitoring marketplace.

Chairman Crapo’s legislation demonstrates his thoughtful approach to reforming financial regulation while promoting economic growth; a goal that started early in 2017 with his committee soliciting reform proposals from industry and outside organizations. As Secretary Mnuchin noted S. 2155 also incorporates many of the Treasury’s recommendations and will provide much needed relief to consumers and small businesses. Americans for Tax Reform has supported President Trump’s call to reform Dodd-Frank and we welcome this reform package.

Photo Credit: Owen Dett

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