INDUSTRY.
THE HOPE IS THAT LOOSENING
WASHINGTON'S GRIP ON THE MAJOR
BANKS WILL BOOST LENDING AND THE
ECONOMY.
JOINING ME RIGHT NOW IS TEXAS
CONGRESSMAN, JEB HENSERLING.
THANK YOU FOR JOINING US.
>> THANK YOU.
>> MARIA: CAN YOU WALK US
THROUGH THE MOST IMPORTANT PARTS
THAT YOU WOULD LIKE THE TO SEE
CHANGED WITHIN DODD FRANK?
>> I LISTENED TO YOUR LEAD-IN,
MARIA AND I WISH I COULD BELIEVE
IT ALL.
THE TRUTH IS, THIS IS NOT A
MAJOR ROLLBACK OF DODD FRANK.
I WISH IT WAS.
I THINK IT WOULD VIEW IT MORE AS
A RECALIBRATION.
BUT IT IS AN IMPORTANT PIECE OF
LEGISLATION THAT THE SENATE IS
TAKING UP.
FRANKLY, WE PASSED A MAJOR PIECE
OF LEGISLATION IN THE HOUSE BACK
IN JUNE AND NOW IT IS MARCH OF
THE NEXT YEAR.
SO WE'VE BEEN WAITING PATIENTLY.
SO WHAT I THINK THIS IS MAINLY
IS SOMETHING THAT WILL HELP OUR
COMMUNITY FINANCIAL INSTITUTIONS
TO SOME EXTENT, OUR REGIONAL
BANKS THAT HAVE A SIMPLE BANKING
MODEL.
I THINK ALSO YOU WILL SEE SOME
IMPROVEMENTS KIND OF IN THE JOBS
ACT, CAPITAL FORMATION FOR EARLY
GROWTH COMPANIES, OUR START-UPS.
BUT THIS IS NOT ANY KIND OF
MAJOR ROLLBACK OF THE DODD FRANK
ACT.
BECAUSE THAT WOULD REQUIRE 60
VOTES IN THE SENATE.
IT'S HARD TO GET 60 VOTES IN THE
SENATE TO AGREE ON A MOTHER'S
DAY RESOLUTION.
SO I DON'T QUITE KNOW WHAT'S
GOING TO COME OUT OF THE SENATE
BILL BUT JUST THE FACT THAT
SENATOR KREPO HAS GOT IT THIS
FAR, IT'S IMPORTANT.
WE'RE LOSING A COMMUNITY BANK OR
CREDIT UNION A DAY IN AMERICA
AND THEY'RE NOT DYING OF NATURAL
CAUSES.
THEY'RE DYING FROM THE SHEER
WEIGHT, VOLUME, COST AND
COMPLEXITY OF DODD FRANK.
AT THE SAME TIME IN AMERICA WE
WAY TOO MANY GARAGES THAT HAVE
OLD CARS AND THEY NEED NEW
START-UPS.
WE WANT TO EXPAND ON THE JOBS
ACT.
WE HAVE A NUMBER OF THOSE
PROVISIONS.
OUR HOUSE BILL IS SO MUCH MORE
HE ROBUST.
I'M ANXIOUS TO SEE WHAT THE
SENATE CAN DO AND WE LOOK
FORWARD TO NEGOTIATING.
>> MARIA: THANK AFOR THAT
RUNDOWN -- THANK YOU FOR THAT
RUNDOWN.
PEOPLE HAVE BEEN WAITING TO SEE
SOME OF THE ROLLBACKS THAT HAVE
TAKEN PLACE IN REGULATIONS HIT
FINANCIAL SERVICES.
I THINK THAT WAS REALLY WHAT I
WAS REFERRING TO, THE FACT THAT
IT'S FINALLY HAPPENING OR
BEGINNING IN FINANCIAL SERVICES.
WHAT ABOUT PROPRIETARY TRADING,
THE VOLKA RULE, WILL THAT BE
ADDRESSED?
>> I DON'T KNOW THE ANSWER TO
THAT.
IN THE HOUSE BILL WE JUST
REPEALED THE VOLKA RULE.
IT'S A SOLUTION IN SEARCH OF A
PROBLEM.
WE HEARD FROM ALL OUR
REGULATORS, MOST RECENTLY FROM
CHAIRMAN POWELL AND THE FEDERAL
RESERVE, THAT BY AND LARGE THIS
IS VERY, VERY HARD TO ENFORCE.
YOU PRACTICALLY HAVE TO HAVE DR.
YOU PRACTICALLY HAVE TO HAVE DRP
YOU PRACTICALLY HAVE TO HAVE DRI
YOU PRACTICALLY HAVE TO HAVE DRL
YOU PRACTICALLY HAVE TO HAVE DRO
YOU PRACTICALLY HAVE TO HAVE DRN
YOU PRACTICALLY HAVE TO HAVE DRY
YOU PRACTICALLY HAVE TO HAVE DRU
YOU PRACTICALLY HAVE TO HAVE DRR
YOU PRACTICALLY HAVE TO HAVE DRT
YOU PRACTICALLY HAVE TO HAVE DRA
YOU PRACTICALLY HAVE TO HAVE DRI
YOU PRACTICALLY HAVE TO HAVE DRG
YOU PRACTICALLY HAVE TO HAVE DRD
YOU PRACTICALLY HAVE TO HAVE DRS
YOU PRACTICALLY HAVE TO HAVE DR,
ASKING WHAT WERE YOU THINKING
ABOUT WHEN YOU MADE THAT TRADE?
AND SO I'M AFRAID THAT WE'RE
SEEING A HIGH LEVEL OF
ILL-LIQUID AT THIS, HIGH LEVELS
OF VOLATILITY IN OUR FIXED
INCOME MARKETS AND A LOT OF THAT
IS DUE TO THE VOLKA RULE THAT
FINANCIAL CRISIS.
IT WAS JUST MORE PILING ON AT
THE LAST MINUTE, IF I REMEMBER,
USING THE PHRASE WE USED IN
CAPITOL HILL.
THIS WAS SOMETHING THAT WAS JUST
AIR-DROPPED INTO THE CONFERENCE
BETWEEN THE HOUSE AND SENATE, IF
I REMEMBER RIGHT.
AND SO IT'S REALLY HURTING.
IT HURTS THE ECONOMY.
IT'S MAKING CAPITAL MORE
EXPENSIVE, LESS AVAILABLE.
SO WE'RE TRYING TO GET RID OF
IT.
IF NOT, WE OUGHT TO AT LEAST
MODERATE IT AND GIVE OUR
REGULATORS THE ABILITY TO TAILOR
THIS AND KIND OF HAVE THE
PRESUMPTION OF INNOCENCE AS
OPPOSED TO YOU'RE GUILTY UNTIL
PROVEN INNOCENT WHICH IS KIND OF
THE WAY THE RULE IS OVERSEEN
NOW.
>> MARIA: ONE THING I KEEP
SAYING IS WHEN YOU HAVE A RULE
CALLED PROPRIETARY TRADING AND
YOU CAN'T EVEN WRITE IT, HOW ARE
YOU GOING TO ENFORCE IT?
YOU CAN'T DIFFERENTIATE WHAT'S
TRADING FOR THE CUSTOMER SO YOU
CAN'T WRITE IT, HOW ARE YOU
GOING TO ENFORCE IT.
I DON'T WANT TO GET CAUGHT UP IN
THE WEEDS.
YOU SAY THE INSTITUTIONS THAT
WILL BE IMPACTED ARE THOSE
COMMUNITY FINANCIAL SERVICES
COMPANIES, THOSE REGIONAL BANKS,
CAPITAL FORMATION, LOOSENING UP
OF CAPITAL.
WHAT DOES THAT LEAD TO ON
PRACTICAL LEVEL?
HOW DO CONSUMERS GET IMPACTED?
>> ALTHOUGH IT'S MODEST, IT'S
STILL IMPORTANT.
I THINK YOU'LL SEE MORE
START-UPS.
I THINK YOU'LL SEE A GREATER
LEVEL OF ENTREPRENEURSHIP.
AND SO I THINK WHAT THE
PRESIDENT HAS DONE TO HELP BRING
US THE TAX CUTS AND JOBS ACT IS
IMPORTANT.
WE NOW KNOW THAT ONCE AGAIN
AFTER ALMOST EIGHT YEARS OF 1.6%
GDP GROWTH, WE'RE NOW AVERAGING
3% ECONOMIC GROWTH.
I THINK, FRANKLY, THIS ECONOMY
IS QUITE CAPABLE OF DOING 3.5%.
BUT WE'RE GOING TO HAVE TO HAVE
COMMON SENSE REGULATION THAT
MEETS A COST/BENEFIT TEST.
WE'RE GOING TO HAVE A REGULATORY
ROLLBACK OF WHAT WAS DONE IN THE
OBAMA ADMINISTRATION WHERE SIX
OF THE WORST SEVEN REGULATORY
YEARS TOOK PLACE ON HIS WATCH,
IN ORDER TO UNLEASH
ENTREPRENEURSHIP, HAVE 3.5% GDP
GROWTH.
THAT MEANS GREATER TAKE-ONLY
PAY.
IT MEANS A MUCH MORE VIBRANT
AMERICAN DREAM.
PEOPLE CAN BUY MORE CARS, THEY
CAN SEND MORE KIDS TO COLLEGE,
THEY CAN PAY THEIR MEDICAL
BILLS.
THAT'S THE DIFFERENCE BETWEEN 3%
GDP GROWTH AND 3.5% GDP GROWTH.
I THINK THIS BILL IS IMPORTANT.
AGAIN, I WISH IT WAS MORE ROBUST
BUT I'M GOING TO HAVE TO SEE
WHAT COMES ACROSS THE SENATE
FLOOR OVER MY RIGHT SHOULDER.
>> MARIA: IT'S GOOD YOU'RE
GETTING STARTED ON THIS ANYWAY
IN THE SENATE.
LET ME MOVE ON.
YOU SAID SOMETHING IMPORTANT,
THAT IS, THIS ECONOMY IS CAPABLE
OF 3.5% GROWTH.
PEOPLE ARE WONDERING IF THAT
NUMBER OR GROWTH IN GENERAL THAT
WE STARTED HERE THIS NEW
TRAJECTORY THAT WE ARE ON, IF
THAT'S THREATENED BECAUSE OF THE
TARIFFS.
PRESIDENT TRUMP'S PLAN TO IMPOSE
TARIFFS ON STEEL AND ALUMINUM IS
INCREASING NAFTA PRESSURE ON
MEXICO AND CANADA.
REPORTS SAY NOW THAT THE EU IS
GOING TO REL TALL
GOING TO RET TALL
GOING TO RETALALL
GOING TO RETALIAL
GOING TO RETALIATE.
THEY'RE PREPARING A PUNITIVE 25%
TARIFF ON ICONIC BRANDS IN
RETALIATION.
THE GOP SEEMS TO BE SPLIT ON
THIS.
WHERE ARE YOU ON THIS ISSUE,
SIR?
>> I HIGHLY RESPECT WHAT THE
PRESIDENT HAS DONE, AGAIN, FOR
OUR TAX CUTS AND JOBS ACT.
I VERY MUCH RESPECT WHAT HE HAS
DONE ON THE REGULATORY ROLLBACK.
BUT I'M AFRAID THAT HE'S GOING
TO TAKE A NUMBER OF STEPS
FORWARD AND TAKE SEVERAL STEPS
BACKWARDS WITH WHAT HE'S DOING
ON TRADE.
HE VERY MUCH DISAGREE.
I ENCOURAGED THE PRESIDENT TO BE
QUITE SURGICAL IN WHATEVER HE
DOES.
I KNOW WE DON'T KNOW THE FINAL
DETAILS.
I REPRESENT A CONGRESSIONAL
DISTRICT THAT'S KIND OF THE
EASTERN PART OF THE CITY OF
DALLAS AND A LOT OF RURAL EAST
TEXAS.
I'VE ALREADY HEARD FROM TWO
MAJOR EMPLOYERS IN TWO RURAL
COUNTIES, ONE USES STEEL TO MAKE
SHELFING AND SELL IT TO PEOPLE
LIKE WALMART.
ANOTHER ONE TAKES STEEL AND
MAKES SMALL BUILDINGS AND THEY
BOTH TELL ME THIS IS GOING TO
HURT OUR BUSINESS.
IT'S GOING TO SEND OUR PRICES
UP.
WE'RE GOING TO LOSE CUSTOMERS.
WE'RE GOING TO LOSE JOBS.
I MEAN, I RESPECTFULLY DISAGREE
WITH OUR PRESIDENT WHO I ADMIRE
SO MUCH OF WHAT HE'S DONE.
I DON'T KNOW WHO'S GOING TO WIN
IN THIS TRADE WAR.
SO I HEAR SOME VOICES IN THE
ADMINISTRATION SAID WELL, THIS
IS VERY SMALL PART OF GDP, IT'S
BASICALLY A ROUNDING ERROR BUT
IT DOESN'T END THAT WAGE MAYBE
IT STARTS OUT THAT WAY.
AGAIN, AS YOU WELL POINT OUT,
WE'RE GETTING THREATS FROM THE
EU AND SO AS I UNDERSTAND IT, WE
HAVE MAYBE 115,000 PEOPLE
INVOLVED IN THE PRODUCTION OF
STEEL IN THE U.S. BUT WE HAVE
MILLIONS, MILLIONS THAT TAKE
THAT RAW MATERIAL AND FABRICATE
IT INTO SOMETHING ELSE.
CONSUMERS WILL BE HARMED.
I THINK THE PRESIDENT'S ON THE
WRONG TRACK HERE.
>> MARIA: THIS IS AN ISSUE WE'VE
BEEN TALKING ABOUT THE JOBS
IMPACTED ARE SO MANY MORE FROM
THE COMPANIES THAT ARE INPUTTING
STEEL AND ALUMINUM.
>> ABSOLUTELY.
>> MARIA: I WANT TO GET TO THE
PRIMARY IN TEXAS IN A SECOND.
LET ME ASK YOU THIS.
WHAT IS THE OTHER SOLUTION?
IS THERE ANOTHER SOLUTION TO GET
THE U.S. OUT OF THE POSITION OF
CONSTANTLY BEING ON THE LOSING
END OF TRADE DEALS?
>> WELL, I THINK IN SOME
RESPECTS THAT'S NOT THE RIGHT
WAY TO LOOK AT IT.
THIS ISN'T THE OLYMPICS.
IT'S NOT A ZERO SUM GAME.
I MEAN, EVERY TIME OUR ECONOMY
IS BOOMING IS WHEN WE TEND TO
RUN THE GREATEST TRADE DEFICIT.
I RUN A TRADE DEFICIT WITH MY
GROCER EVERY MONTH.
I RUN A TRADE DEFICIT WITH THE
DRUGGIST.
THE BIG QUESTION IS WHAT IS OUR
GDP GROWTH.
CAN WE AFFORD TO BUY PRODUCTS
OVERSEAS?
SO LISTEN, THE PRESIDENT'S A
GREAT NEGOTIATOR.
I HOPE THAT I'M WRONG AND HE'S
RIGHT AND THAT THIS IS GOING TO
LEAD TO SOMETHING GOOD.
BUT AS HISTORY IS MY GUIDE, I
SERIOUSLY DOUBT IT.
THE PRESIDENT SAYS HE WANTS TO
NEGOTIATE BILATERAL DEALS.
RIGHT NOW, THESE ACTIONS ARE
INVITING RETALIATORY ACTIONS.
THEREAFTER TIME THERE WAS A
SIGNIFICANT TRADE WAR, I
REMEMBER THE SNOOT HOLLY TARIFF,
IT WAS NOT A GOOD THING.
>> MARIA: YOU'RE MY M