Financial Stability Oversight Council Improvement Act of 2017

Floor Speech

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Mr. SHERMAN. Mr. Speaker, I support the committee system. The Democratic Caucus has put roughly 25 of its members on the Financial Services Committee. We are the members of the Democratic Caucus assigned to study and debate legislation on Financial Services issues.

We did just that. And 60 percent of the Democrats assigned to the Financial Services Committee, 15 Democrats, voted in favor of this bill, while 10 opposed it.

So if members of our caucus wonder what would our caucus position be if all the members of our caucus had a chance to really analyze bills in this particular technical area, one would expect that 60 percent of our caucus would support this legislation.

The reason for that is that the purpose of regulation is to reduce risk rather than having risk be the reason to have regulation.

This bill focuses on getting companies to reduce their risk. There are those that say if we just designate more companies as SIFIs, we will get more regulation.

No, you won't.

What you get is more companies designated, but then you get pressure to have less regulation on all the designated companies.

What we need is to reserve the SIFI designation for those who are clearly exposing our economy to the risk of another meltdown, and we need to encourage companies to be less of a risk to our economy.

The ranking member, who is bearing a substantial oratorical challenge, being, I think, the only speaker opposing the bill, correctly points out that AIG was a risk to our economy.

That is right.

This bill would have put it to AIG that you are going to get designated and regulated if you don't get out of the credit default business.

Had they done that, the meltdown in 2008 would have been much less significant.

So let us encourage these companies to de-risk, and let us have heightened regulation on those who refuse to do so or who by their very size pose a risk to our entire economy.

Mr. Speaker, I urge my colleagues in the Democratic Caucus to have some faith in the 60 percent majority who have been assigned to the Financial Services Committee and voted in favor of this bill.

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