WASHINGTON — As the House continues its long, contentious contest over who will serve as its next speaker, one senior member of the House Financial Services Committee previewed oversight of the Federal Reserve's Basel III endgame proposal.
Rep. Andy Barr, R-Ky., said that House Financial Services Committee Chairman Patrick McHenry will return to the panel after his stint as speaker pro tempore. He declined to comment on what McHenry's ascension to House leadership means for the future of the committee.
"He's a bit busy as the speaker pro tem, but he's excited to get back to his day job," Barr said at comments delivered at the Bank Policy Institute on Wednesday. At the time, Rep. Mike Johnson, R-La., was gearing up for a speakership vote on the House floor.
The contention over House leadership has derailed the schedule of the House Financial Services Committee, with at least several hearings postponed from Tuesday that would have continued to build Republicans' case challenging the regulations proposed by the Biden administration's financial regulators.
Barr said that the committee will
"De facto, this is a rollback of a congressional directive to tailor regulation," he said. "I don't think we need a one-size-fits-all approach to bank regulation. I don't think the risk profile of regional banks, small regional banks is the same as the largest G-SIBs in our system."
Barr referenced the Administrative Procedures Act, an avenue that Republicans could take to officially challenge the rulemaking should the Fed not make substantive changes to their proposal.
"We don't have the rigorous cost-benefit analysis that is required in the Administrative Procedures Act," Barr said. "We've
Barr also mentioned potential divisions between Fed Chairman Jerome Powell and Vice Chair for Supervision Michael Barr, and said that House Republicans intend to pressure Powell on the rulemaking along with Vice Chair Barr.
"I had a very positive conversation with Chairman Powell last week about this, and what was emerging about that conversation is that he's a collegial guy, and he respects Mr. Barr — as we all do — but he respects the statutory role that was created in Dodd-Frank with the vice chairman for supervision and he said it is the role of the vice chairman for supervision to propose regulatory supervisory changes, but it is not the vice chair of supervision's job to finalize rules," Rep. Barr said. "And that was an encouraging comment.
"We're going to hold Chairman Powell's feet to the fire on that point, and we're going to insist on consensus as they review and revise this proposal in the coming months," Rep. Barr continued.
Along with oversight of the Fed over its Basel III capital rule, Barr said that the House Financial Services Committee will resume work on crypto legislation. He said that the National Defense Authorization Act — a must-pass spending bill that has taken on increasing urgency given the violence in Gaza in the conflict between Hamas and Israel — is a likely target for the committee to attach the crypto bill to as a rider. The crypto legislation, including a stablecoin bill and a market structure bill for crypto, is being spearheaded by Chairman of the Subcommittee on Digital Assets Rep. French Hill, R-Ark.
"I think that the National Defense Authorization Act could be a vehicle for Chairman McHenry and Chairman Hill to move their products, and I do think it has national security implications," Barr said. "I think the dollar's dominance is at issue."
On Consumer Financial Protection Bureau oversight, Barr said that he hopes the House will take up the Senate's vote to
"We'd love to see the president actually sign a CRA, but whether we have the votes to override a veto [is unclear]. That's why we need a speaker," Barr said. "I'm all for it."
