Promoting Job Creation and Reducing Small Business Burdens Act

Floor Speech

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Mr. LYNCH. Mr. Speaker, I want to thank the gentlewoman for yielding and for her great work on this issue.

Mr. Speaker, I rise in strong opposition to H.R. 37, the so-called Promoting Job Creation and Reducing Small Business Burdens Act.

I served on the Financial Services Committee during the 2008 financial crisis, and I had an opportunity to witness the harmful impact that lack of regulation had on hardworking families around our Nation at a total cost of more than $22 trillion, according to the Government Accountability Office. My constituents--and many of yours--lost their homes, their jobs, and their retirement savings during that period. Many pension funds today continue to suffer and are on the brink of collapse because of the reckless policies that were observed during that time by many of our major banks.

While I voted against the bailout of the Wall Street banks who were rewarded with bonuses as a result of the bailout, I did have the honor of helping to assist in reforming our financial system through the enactment of the Dodd-Frank Wall Street Reform and Consumer Protection Act. I regret the bill under consideration today rolls back many of those reforms that my colleagues and I fought so hard to adopt.

I would note that after being defeated last week under a suspension process that offered no opportunity for amendments, this bill now has inexplicably been brought to the House floor under a closed rule that again does not include any of the 14 amendments that were filed with the Rules Committee. At a minimum, a bill that does so much harm to our financial system necessitates the normal committee process and additional time for debate.

H.R. 37 contains 11 separate bills, a few of them which I support, others I strongly oppose. Portions of H.R. 37 have entirely new provisions that the members of the committee and of this Congress have not had the opportunity to thoroughly analyze.

By the way, if you desire a good review of this legislation, in this past Sunday's New York Times there is an article written by Gretchen Morgenson that I think is extremely well-written and goes into great detail beyond the time that I am allocated here tonight.

Title II of this bill would allow banks with commercial business to trade derivatives privately rather than on clearinghouses. This would increase risk and reduce transparency for these transactions. My amendment, which was not accepted, would have improved the provisions by prohibiting systematically important financial institutions, whose collapse would pose a serious risk to our financial system, from claiming the exemption under this title.

Title VIII of this bill includes new language that has not been considered by the Financial Services Committee under regular order. If passed, title VIII would give banks an additional 2 years to comply with the provisions of the Volcker rule that mandates that banks divest collateralized loan obligations--packages of risky debt.

The SPEAKER pro tempore. The time of the gentleman has expired.

Ms. MAXINE WATERS of California. I yield the gentleman an additional 2 minutes.

Mr. LYNCH. I thank the gentlewoman.

This 2-year extension is in addition to the extension we already provided by the regulation last year. That further delay adds unnecessary risk to our financial system. And that is why I sponsored another amendment to remove this additional 2-year delay, so banks will be required to comply with this provision of the Volcker rule no later than July 21, 2017.

Again, title XI of this bill modifies the SEC rule 701 by allowing private companies to compensate their employees up to $10 million in company securities without having to provide those employees with certain basic financial disclosures about the company stock.

I strongly support employees receiving equity benefits from their firms in which they work, but those benefits should be tangible and real. We all remember Enron and WorldCom where employees were pressured to buy stock as part of their compensation, and at the end of the day, that stock was completely worthless.

Why can't we enable employees to receive some equity in the company in which they work and ensure that those workers get accurate financial disclosure as part of that deal? This is why I offered three amendments to reform title XI in order to make certain workers get accurate information about the equities shares that they are receiving from the companies they work for. Unfortunately, the Rules Committee chose to deny all the amendments to this bill.

In closing, this harmful bill uses the veneer of job creation to provide special treatment for well-connected corporations and financial institutions while doing very little for the workers that it professes to help.

Mr. Speaker, I urge my colleagues to vote ``no'' on this bill, and, again, I thank the gentlewoman for yielding.

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