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New Financial Services Chair Plans Robust Oversight of Financial System

Rep. Maxine Waters (D-CA), the new chair of the House Financial Services Committee, recently outlined a full-bodied agenda that seeks to protect consumers, safeguard investors and prevent another financial crisis.

In terms of setting the committee’s agenda, Waters, who has served on the committee since 1991, thus sets a sharp deviation from that of the previous chairman, Rep. Jeb Hensarling (R-TX), who retired last year at the end of the term.

Waters set forth a long list of priorities, including protecting investors from abusive financial practices, ensuring that strong safeguards are in place to prevent another financial crisis, encouraging responsible innovation in financial technology, promoting diversity in the financial services sector and ensuring that small businesses have fair access to the financial system.

In general, the House Financial Services Committee oversees Dodd-Frank issues, the SEC, monetary policy, banking, housing and insurance issues, as well as international finance.

In a Jan. 16 speech before the Center for American Progress, Waters explained that an ongoing priority of hers will be to ensure that the Consumer Financial Protection Bureau remains strong, pledging to work “diligently to undo the damage that [former acting director] Mulvaney has wrought during his time at the Consumer Bureau.”

Waters also said she plans to keep “a watchful eye on all of the financial regulators to make sure that they are carrying out their statutory duties, including holding bad actors accountable, and promoting financial stability.”

Waters specifically cited reforms under the Dodd-Frank Act that she plans to monitor. “As we saw during the 2008 financial crisis, large Wall Street banks that aren’t subject to strong oversight and safeguards to protect our economy can do a lot of damage, and so in Dodd-Frank we put in place robust reforms for our largest and most complex financial institutions, including increased capital, reduced leverage, improved liquidity, vigorous stress testing, and thorough living wills, all designed to improve financial stability,” she explained. Waters further pointed to the operations of the Financial Stability Oversight Council and Volcker Rule as areas she will closely monitor.

“The Committee will be paying close attention to whether financial regulators try to weaken these important reforms, and keeping an eye on the big banks and their activities, including by holding many hearings,” Waters asserted.

Congressional Committees Take Shape

Meanwhile, membership of the key retirement and tax policy committees continues to change at the outset the new session of Congress, setting the stage for an active year for retirement policy legislation.

In the Senate, Sen. Charles Grassley (R-IA), the newly reinstalled chair of the Senate Finance Committee, says he hopes to continue a “tradition of bipartisanship” within the committee. Grassley recently announced his priorities for the 116th Congress, which include advancing legislation to “protect and enhance Americans’ retirement security.”

Grassley also plans to address IRS tax administration issues, as well as enhance consumer-directed health care tax options, including HSAs, HRAs and FSAs. Additionally, he will seek to make permanent the temporary provisions of the 2017 Tax Cuts and Jobs Act (TCJA), many of which expire in 2025.

In contrast, Richie Neal (D-MA), the new chair of the House Ways and Means Committee, has promised to conduct a thorough review of the TCJA.

Neal has a robust agenda of his own regarding retirement security legislation. Nonetheless, retirement policy issues traditionally have seen bipartisan agreement, and there is still optimism that the two sides can come together to enact meaningful retirement policy legislation.

House Education and Labor Committee

For his part, the new chairman of the House Committee on Education and Labor, Rep. Bobby Scott (D-VA), has indicated that he plans to “support innovative solutions” to reduce the coverage gap for workers who do not have access to an employer-provided retirement savings plan. Scott also plans to support legislation that addresses the adequacy of workplace retirement savings plans and puts “more Americans on a path toward being able to live a stable retirement.”

Scott also recently announced his support of Neal’s reintroduction of the Rehabilitation for Multiemployer Pensions Act (a.k.a. the “Butch Lewis Act,” named for a leader of Teamster Local 100 in Ohio who died in 2015).

Among the issues contained within the jurisdiction of the Education and Labor Committee, which recently underwent a name change, are matters concerning employment-related health and retirement security issues involving ERISA, as well as other employee benefit and labor-related issues.

The new Democrats on the committee are:

  • Josh Harder (CA)

  • Jahana Hayes (CT)

  • Pramila Jayapal (WA)

  • Susie Lee (NV)

  • Andy Levin (MI)

  • Lucy McBath (GA)

  • Joe Morelle (NY)

  • Ilhan Omar (MN)

  • Kim Schrier (WA)

  • Donna Shalala (FL)

  • Haley Stevens (MI)

  • David Trone (MD)

  • Lauren Underwood (IL)

  • Susan Wild (PA)

House Ways & Means Committee

In addition to the 10 previously announced Democrats who will be joining the House Ways & Means Committee, the House leadership has announced that Rep. Jimmy Gomez (D-CA) will also join the committee.

The new Republican members joining Ways & Means are:

  • Jodey Arrington (TX)

  • Drew Ferguson (GA)

  • Ron Estes (KS)

In addition, Rep. Mike Thompson (D-CA) will serve as chairman of the Select Revenue Measures Subcommittee, previously known as the Tax Policy Subcommittee. Rep. Adrian Smith (R-NE) will serve as the new ranking member on the subcommittee, replacing Rep. Peter Roskam (R-IL), who was defeated in last year’s elections.