Letter Opposing Cloture on the Motion to Proceed to S. 3217, the "Restoring American Financial Stability Act"
April 26, 2010
TO THE MEMBERS OF THE UNITED STATES SENATE:
The U.S. Chamber of Commerce, the world's largest business federation representing the interests of more than three million businesses and organizations of every size, sector, and region, urges you to oppose cloture on the motion to proceed to S. 3217, the "Restoring American Financial Stability Act," because the bill, in its current form, fails to achieve the meaningful financial regulatory reform necessary for vibrant capital markets that is needed to fuel long-term economic growth and job creation.
The financial crisis has highlighted problems that have existed within the U.S. financial system for quite some time. Before the crisis erupted, the Chamber called for a broad-based overhaul of the U.S. financial regulatory system as a means to increase the efficiency of capital markets and provide business with the opportunity to grow and expand. The Chamber was not alone in pointing to the fact that a patchwork system of regulation creates inefficient capital markets and thwarts the ability of the economy to grow. S. 3217 fails to accomplish some needed policy changes and contains a number of provisions that would hinder our economic recovery and job creation.
The Chamber opposes the creation of a stand-alone consumer protection bureau. This bureau has overly broad powers to regulate Main Street and is accountable to no one. S. 3217 would perpetuate the market's expectation that certain financial institutions are "too big to fail," and the moral hazard associated with this. This bill would hinder or prevent legitimate end-users of derivatives from using these instruments to legitimately hedge the risk of their commercial operations. In addition, S. 3217 would federalize corporate law, creating a one-size-fits-all system, to the detriment of shareholders and directors.
The Chamber believes that, in its current form, S. 3217 does not achieve the financial regulatory reform that is needed for the economic growth and job creation for a prosperous 21st century economy. The Chamber may consider votes on, or related to, S. 3217 in our annual How They Voted Scorecard, including the vote on the motion to proceed.
R. Bruce Josten