Economic Growth, Regulatory Relief, and Consumer Protection Act--Motion to Proceed

Floor Speech

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Mr. McCONNELL. Mr. President, community banks, credit unions, and other small-scale lenders play a vital role in the U.S. economy.

Research from Harvard indicates that community banks provide more than half of all small business loans. Let me repeat that. A majority of small business loans is handled by community banks. This is even more pronounced in rural areas and farming communities, like those I represent in Kentucky. A whopping 77 percent of agricultural loans come from community banks--77 percent.

In this era of online banking and multinational corporations, smaller institutions remain uniquely able to build community connections. Community bankers get to know their residents and business owners on a personal level. That perspective lets them extend credit to small-scale entrepreneurs, farmers, ranchers, and other Americans who might not have access otherwise. So when small lenders close their doors, the effects on communities are very real.

In 2014, an economist at MIT found that, on average, the closing of a single bank cut the number of new small business loans in the immediate area by more than 10 percent for several years. The problem was extremely pronounced in low-income areas, where a local perspective and personal relationships matter even more. In low-income America, a physical bank closure cuts lending to local small businesses by nearly 40 percent.

Long story short, the more vulnerable a community, the more they need local lenders, but since the Federal Government implemented massive new regulations under the 2010 Dodd-Frank Act, our community banks and credit unions have been getting squeezed. Dodd-Frank's imprecise, inefficient, one-size-fits-all framework dropped these small institutions into the regulatory maze that was intended for Wall Street. For 8 years, they have faced a staggering compliance burden that now consumes, on average, 24 percent of their net income. This has forced many to pare down their offerings or close their doors for good. That leaves out to dry would-be entrepreneurs, job creators, and existing small businesses that want to expand.

Fortunately, we have an opportunity this week to begin putting things right. Today, the Senate continues considering a sensible solution that would streamline regulations and give smaller lenders a fighting chance. Senator Crapo's Economic Growth, Regulatory Relief, and Consumer Protection Act is the product of thorough committee work. It is an important step toward unwinding the harm caused by the Obama administration's knee-jerk reaction to the 2008 financial crisis.

Importantly, this bill has strong bipartisan support. On both sides of the aisle, Members with a diversity of views on Dodd-Frank itself have recognized that this set of commonsense fixes deserves all of our support. I encourage all Senators to join them. Tax Reform

Mr. President, on another matter, just 2 months in, the effects of tax reform are percolating through every corner of our economy. It has made bonuses, raises, and benefits for working families daily news in communities all across our country.

Thanks to tax reform, automakers are planting deeper roots in America. Innovators like Apple are bringing billions back to invest here at home. Retailers, from corner stores to national chains, are rewarding their hard-working teams. There is another sector in which the benefits of tax reform are flowing freely--America's growing craft beverage industry. That is because the new 21st-century Tax Code included a provision known as the Craft Beverage Modernization and Tax Reform Act, spearheaded by Senator Portman and Senator Blunt. Among other achievements, that piece of tax reform significantly cut the excise taxes the Federal Government imposes on beer, wine, and spirits.

This was originally a bipartisan bill, with early support from my friend, the senior Senator from Oregon. It is too bad he and every other Democrat in Congress ended up voting against this historic tax reform that included that measure, because it is proving to be good news for a host of American small businesses, including the fine distilleries that contribute thousands of jobs and tourism in Kentucky.

One recent wave of headlines has detailed how tax reform is helping entrepreneurs in the craft brewing industry as well. Across the country, job creators in this popular and growing line of business are making big plans for their savings under this new 21st-century Tax Code.

Matt Matthiesen, a brewery owner in West Okoboji, IA, said: ``I am very excited. . . . As a small local business, those breaks help us tremendously.''

Donn Martens, who owns another brewery just down the road, said: ``We hope to expand with this money. We would like to double our production.''

Remember Matt and Donn when my colleagues across the aisle tell you tax reform is only helping the big guys. Together, their two businesses employ 15 people. They expect tax reform will save them about $15,000 this year. Just try telling any small business owner that is no big deal.

Larry Horwitz owns Four String Brewing Company in Columbus, OH. He expects tax reform will save his business $40,000 this year. ``We invest where we live and work,'' he said. ``We are the blue collar workers in the neighborhood.''

In Kentucky, tax reform has a number of craft breweries excited about the year ahead. At Country Boy Brewing in Georgetown, production manager Daniel Sinkhorn says the new law is helping them plan a new canning line, which will ``add jobs, add equipment . . . and keep Country Boy growing.''

It has been reported that later today my friends across the aisle will unveil a $1 trillion spending plan and propose repealing tax reform to pay for it.

Repeal all these bonuses, pay raises, new jobs, and new investments? Talk about a nonstarter.

At the same time, Vice President Pence will be in Central Kentucky today to hear from small business owners and community leaders about how tax reform is helping them. Daniel Harrison, the cofounder of Country Boy Brewing, will be on hand to meet with the Vice President. I am glad he will be able to share how his business, like so many around the country, is tapping into tax reform savings.

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