Crapo: Banking Regulators Sacrifice Quality and Fairness In Exchange for Speed

Press Release

The Dodd-Frank financial reform legislation approved last year by Congress needs careful congressional and public review to ensure it takes into consideration public comments and does not stifle economic recovery, said Idaho Senator Mike Crapo and Republican members of the Senate Banking Committee today. Crapo, Ranking Member Richard Shelby and other Republicans on the committee are requesting that regulators implementing Dodd-Frank rulemakings allow for adequate time for meaningful public comment and conduct rigorous analyses of the costs and benefits of their rules.

The request comes as the Banking Committee plans a Thursday hearing entitled "Oversight of Dodd-Frank Implementation: A Progress Report by the Regulators at the Half-Year Mark". Crapo said the speed of implementing the bills is defeating necessary public input and economic analysis.

"The rules adopted under the Dodd-Frank Act will have a long-term effect on economic growth; they will affect how consumers and businesses obtain credit, allocate capital and manage risk," Crapo said. "Given the volume, complexity and potential consequences of the Dodd-Frank rulemaking, regulators particularly need the input of consumers, who can help to assess effects of rule proposals on job creation and economic growth, provide less costly alternatives and provide useful empirical data for the agency to use in its analyses."

"Regulators must not compound the mistakes of Dodd-Frank by promulgating uninformed rules," said Ranking Member Shelby. "They must listen to the public and fully consider their views."

Crapo said that despite the abbreviated comment periods, Senators have heard many comments from the public who have done their own analysis and identified flaws in agency cost-benefit analyses. He said that, if afforded additional time, more unanticipated consequences of proposed rules could be detected. "I am concerned that some agencies view economic analysis as nothing more than a nuisance or a mere formality," Crapo added. "Given the grave economic conditions we have experienced, implementation of these reforms is too important to get it wrong."

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