U.S. Chamber Calls on Senate to Revive Bipartisan Financial Regulatory Reform

Calls for Putting Politics Aside, Fixing Bill

WASHINGTON, D.C.—The U.S. Chamber of Commerce today called on the Senate to revive its bipartisan effort on financial regulatory reform and warned that failure to fix the bill could harm America's economy and job creation.

"The American economic recovery depends on getting these reforms right so that businesses of all sizes can get the cash they need to create new jobs and invest in their future," said David Hirschmann, president and CEO of the Chamber's Center for Capital Markets Competitiveness (CCMC). "There is still time to fix the flaws in the legislation that Congress is considering if our leaders can set politics aside and focus on effective reforms to our broken and outdated financial system."

The U.S. Chamber has long called for modernizing our financial regulatory system by ending "too big to fail," protecting consumers, and bringing transparency and regulation to derivatives markets. It has also called for closing gaps in regulation, eliminating duplicative layers, and creating a regulatory structure to ensure that the United States has the most vibrant, efficient, and transparent capital markets in the world.

The Chamber believes that it is not the intent of Congress or the president to harm small businesses or other non-financial firms who did not contribute to the economic crisis.

The Chamber proposed the following fixes to the pending legislation in a letter to the full Senate:

• Addressing Flawed Consumer Protection: Narrowing the scope to exclude non-financial firms that allow their customers to pay in four installments or impose late fees; preserving federal preemption so that consumers will benefit from one single set of rules and disclosures; establishing effective coordination with other regulators; and making appropriate governance changes, including establishing a bipartisan commission to lead the new agency.
• Eliminating Collateral Damage for Main Street in the Derivatives Section: Avoiding a significant and unnecessary drain on working capital in companies across the country by ensuring a clear exemption from central clearing and bilateral margining for corporate end-users. In addition, legislation should make clear that existing contracts that were negotiated according to the law and market practices at that time will be upheld.
• Ending too Big to Fail and Fixing Resolution: Eliminating the $50 billion fund and providing certainty in the treatment of all creditors at failing firms.
• Removing Union and Other Special Interest Access to the Proxy at Every Public Company.
• Removing Unilateral Volcker Rule: These proposals should only be implemented on a global basis, focusing on all approaches, including requiring heightened capital requirements and liquidity standards.

"Congress and the administration say that reform should focus on Wall Street. So why are there still significant provisions in the bill that hurt Main Street?" asked Hirschmann. "It's been 75 years since we last overhauled our financial regulatory system. Rushing to implement politically driven reforms is the wrong way to fix our financial system."

Since its inception three years ago, the Center for Capital Markets Competitiveness has led a bipartisan effort to modernize and strengthen the outmoded regulatory systems that have governed our capital markets. The CCMC is committed to working aggressively with the administration, Congress, and global leaders to implement reforms to strengthen the economy, restore investor confidence, and ensure well-functioning capital markets.

The U.S. Chamber of Commerce is the world's largest business federation representing the interests of more than 3 million businesses of all sizes, sectors, and regions, as well as state and local chambers and industry associations.

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