WASHINGTON, D.C.— Congressman Tom Rice (SC-07), Chairman of the Small Business Subcommittee on Economic Growth, Tax and Capital Access, today held a hearing titled Financing Main Street: How Dodd-Frank is Crippling Small Lenders and Access to Capital.
The Dodd-Frank Wall Street Reform and Customer Protection Act was signed into law by President Barack Obama in 2010. The intent of the law was to promote financial stability by improving accountability and transparency in the financial system, end “too big to fail” banks and lower banking risk.
“Since signed into law over five years ago, the problems caused by Dodd-Frank have far exceeded the benefits. The law was designed to reduce banking risk and prevent banks from becoming ‘too big to fail.’ What it has done is the exact opposite,” said Rice.
“The big banks are still getting bigger. Small bank formations are at 80 year lows. Net business startups are at 80 year lows. Home ownership is at 50 year lows. Workforce participation is at 30 year lows. We’re in a bad spot and I think Dodd-Frank, and just general banking regulation, has a lot to do with that. I think we vastly diminished access to capital in this country and we need to deal with it or it bears poorly for our economy,” concluded Rice before adjourning the hearing.
Witnesses included Scott Eagerton, President of Dixies Federal Credit Union in Darlington, SC, Doyle Mitchell, President/CEO of Industrial Bank, Marshall Lux, Senior Fellow at Harvard University, and Julia Gordon, Senior Director of Housing and Consumer Finance at Center for American Progress.