By Katanga Johnson and Pete Schroeder
WASHINGTON (Reuters) – Washington’s leading liberal think tank, which for years has shaped Democratic financial, economic and social policies, has begun drawing up a list of Wall Street-friendly rules that could be swiftly repealed if the party wins big in the election.
The list from the Center for American Progress (CAP), shared exclusively with Reuters, offers the first glimpse at which of the financial rules by President Donald Trump’s administration could be first on the chopping block if Democrats take the White House and the U.S. Senate on Nov. 3.
They include rules that eased speculative bank investments, reduced swap capital cushions, and overhauled fair lending regulation, all of which, if reversed, could cost the financial industry tens of billions of dollars.
According to CAP’s analysis, these could be swiftly axed via the Congressional Review Act (CRA), a 1996 law that allows Congress to reverse new federal rules with a simple majority.
“We need to reverse as much of the Trump administration’s damage as quickly as possible. The CRA is a critical tool that should be used to help accomplish that goal,” said Gregg Gelzinis, a senior policy analyst at CAP who advocates on financial regulation.
Founded in 2003 by top advisers to the Clintons, CAP has had outsize influence on Democratic policies for years. The group had close ties with the Barack Obama administration, helping with both policies and personnel, according to media reports.
Joe Biden, Obama’s former vice president who goes up against Trump in the Nov. 3 presidential election, has yet to lay out a detailed financial reform plan, giving CAP and other liberal groups a potential opportunity to help shape his agenda.
Gelzinis said he will be meeting with lawmakers’ offices in coming weeks to discuss the list and would approach Biden’s transition team if he wins, adding: “It’s important that a new administration and Congress are both in sync on CRA efforts.”
The group will focus on rules that mitigate systemic risks, such as bank capital requirements, an area on which there is less congressional consensus than consumer protections, he said.
A spokesman for Biden’s campaign said he would “consider every tool available…to reverse Trump’s damaging policies.”
Sherrod Brown, the top Democrat on the Senate banking panel who would likely lead any financial CRA bills, intends to use every tool, including the CRA, to advance his agenda to reduce financial risk and protect consumers, his office said.
‘PANDORA’S BOX’
The CRA allows a new session of Congress to reverse rules passed during the final 60 working days of the previous Congress. Before Trump took office in 2017 pledging to slash red tape for corporate America, the CRA had only been successfully used once.
Republicans have since used it to reverse 16 rules, 15 of which were from the Obama-era, including discriminatory lending protections and a ban on forced arbitration, according to Daniel Perez, senior policy analyst at George Washington University’s Regulatory Studies Center.
Trump regulators have also in recent years changed dozens of other rules created decades ago, as well as in the aftermath of the 2009 financial crisis, which they say are outdated and burdensome.
For some liberals who say Trump’s measures have lined Wall Street’s pocket while increasing risk and hurting consumers, a strong Biden win would be pay-back time.
“We saw Republicans open the Pandora’s box to unleash the once-dormant CRA,” said Amit Narang of Washington-based advocacy group Public Citizen who is also identifying CRA targets. “Should Democrats be successful in November, they will aggressively use the tool.”
Reversing rules through an agency’s internal process can take years whereas CRA bills, which can pass with a simple 51-49 majority in the Senate and cannot be filibustered, move fast.
The law also bars agencies from writing similar rules, another plus for an incoming administration which cannot always remove the previous administration’s top officials. And unlike agency rules, the CRA generally cannot be challenged in court.
Calculating whether a rule falls within the 60-day limit is tricky, however, because congressional working days are fluid and are determined retrospectively in January, but CAP estimates late April as the earliest cut-off.
(Reporting by Katanga Johnson and Pete Schroeder; Additional reporting by Trevor Hunnicutt in New York; Editing by Michelle Price and Aurora Ellis)
The post Exclusive: Center for American Progress takes aim at Trump’s Wall Street-friendly rules appeared first on Morningology.
