House Republicans tried yesterday to pass a package of eleven bills that would roll back one or more parts of the 2010 Dodd-Frank financial reform law. Cristina Marcos reported for The Hill,

The measure – one of the first to be considered in the new Congress – was brought up under a fast-track procedure typically considered for noncontroversial legislation that requires a two-thirds majority to pass. But Democratic opposition led to its defeat, by a vote of 276-146.

After the jump I’ve posted the floor speech by Representative Keith Ellison of Minnesota, who laid out the Democratic case against passing this bill. He pointed out its substantive flaws and argued against a process that allowed such a complex bill to be brought to the floor in 24 hours, outside “regular order.”

The roll call shows that not only did all three Iowa Republicans vote for this bill, Dave Loebsack (IA-02) was among the 35 Democrats who supported it too. On social media I’ve seen some confused or angry Iowa Democrats ask why Loebsack would vote for such a bad bill. Although he may agree with its content, I would guess that he mostly wanted to protect himself against future campaign attacks. (Political considerations have pushed Loebsack to vote for many bad Republican bills.) Even if he agrees with rolling back Dodd-Frank reforms, though, Loebsack should not have gone along with rushing it through on the second day of the new Congressional session. Legislation this complicated and far-reaching should be debated and marked up in committee first.

Democrats who aren’t happy with Loebsack’s vote should be sure to let him know. Unfortunately, I anticipate many votes like this one to follow.

Floor speech (as prepared) by Democratic Representative Keith Ellison of Minnesota, January 7:

We begin the new Congress the same way the last dysfunctional Congress ended-Republicans are distorting House procedures to ram legislation through Congress that benefits their cronies. Although this Congress is only one day old, we are going to vote today on a piece of legislation that makes nearly a dozen complex legal changes to our financial markets. We have absolutely no idea what the cumulative effect will be. Some of this legislation has only been public for a mere 24 hours. And, what’s particularly frightening is that the bill text has changed at least three times since Tuesday. Mr. Speaker, I’m not even sure if the language I have before me is the correct bill. Are you?

Mr. Speaker, the House of Representatives just yesterday passed its amendments to the Rules of the House. These rules, as in previous Congresses, lay out how the House deliberates legislation. “Regular order,” whereby legislation is debated at a hearing, marked up by a Committee, and then finally considered by the whole House, is the process by which we vet legislation for the American public. We do this to ensure that we fully understand the consequences of changing our law.

Nevertheless, the Republicans have come here to suspend those rules, to consider a package of eleven bills easing oversight of Wall Street firms, large banks, multi-national corporations and certain brokers.

They have never considered how all of the pieces fit together.

They have not allowed Members of Congress to offer amendments to this legislation.

52 new Members of Congress, who represent more than 30 million Americans, were sworn in yesterday and will have to vote on bills affecting the collateral firms pledge when they borrow money and affecting what information must be disclosed about certain brokers or financial statements of firms without the opportunity to offer changes.

This is not how our Democracy was intended to function. It doesn’t matter what side of the aisle you are on…each of these new Members should vote “no” on this legislation.

Since we are going to have to vote anyway, let me try to describe what’s inside this complex package. It’s not only the process that is wrong, there is worrisome content too. That is why more than 100 members of this body opposed a previous version of this bill last September:

Weakens the Volcker Rule.

This bill undercuts an important part of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The Volcker Rule was intended to prevent deposit-taking banks from making bets using taxpayer insured funds. Even though the Federal Reserve went out of its way to ease the transition to a safer system, this bill would give mega-banks another two years to sell off certain securities in which they retain ownership rights. And this provision, which almost certainly juices the profits of the mega-banks like Citigroup and JP Morgan, has never been vetted. The public has not even had a day to review this text. How are we supposed to vote on this?

It’s wrong that bills that help Wall Street and multi-national corporations get fast-tracked on day 2 while bills that help working families have been slow-walked for years.

Just last month, Republicans successfully handed Citigroup and the other mega-banks a multi-billion dollar gift by repealing another reform measure known as “Swaps Push-Out,” which was intended to prevent another Great Recession. The repeal of that provision allowed the mega banks continue to borrow from the Federal Reserve lending window – currently at about zero percent interest — to finance their risky derivatives trading.

Weakens Derivatives Provisions.

This bill also includes three other provisions that weaken the Dodd-Frank Wall Street Reform and Consumer Protection Act by taking away authority from the regulators charged with ensuring that everyone plays by the same rules. So, if at some point in the future we find out that our financial system is threatened, our regulators will be unable to take decisive action to fix the problem as they can do today. After witnessing the effect that one type of derivative, the credit default swap, had in spreading the losses from the subprime mortgage market around the world, I’d like to know why our first order of business this Congress is to roll back financial reforms that this Congress deliberatively passed over an 18-month period following the 2008 Financial Crisis.

Undermines investor protections.

The bill includes three provisions that have the potential to leave investors worse off than they are today. In one instance, the bill exempts individuals that would broker a merger of a privately-owned company to be exempt from SEC registration. Since this legislation passed in the previous Congress, the SEC took actions making it unnecessary. However, if we pass the bill today, we will undermine a few basic investor protections the SEC retained. For example, the SEC determined that bad actors, such as convicted securities fraudsters, should not be able to take advantage of the carve-out. However, by voting yes, you are saying that it is ok for people convicted of fraud to sell other things – like franchises or the restaurant down the street.

Another provision would allow 75% of all public companies to no longer report their financial statements in computer-readable formats. When everything is online today, and investors rely on computers to crunch the financials of various companies, this bill comes across as a huge step backwards. Ironically, my colleagues on the other side seem to forget that our capital markets only function as well as they do because investors understand the companies they are investing in. Even Republican Congressman Darrell Issa has pressed the SEC to do more on this issue to make company data more investor-friendly – this bill take the opposite approach, and undoes much of the progress the SEC has made. Why would we risk intentionally harming both small companies and investors this way?

If much of this bill reads as if we never had a financial crisis, Title Eleven reads like we never had an ENRON or Worldcom. I am all for private companies compensating their employees with company securities but not if basic financial disclosure documents are not provided. This provision provides up to $10 million in company securities without having to provide the employees certain basic financial disclosures about the company. That’s right, this bill raises the maximum compensation from $5 million to $10 million – which will increase with inflation — without requiring basic financial disclosures to the employees.

Those benefits should be tangible and real and not subject to any accounting shenanigans. We all remember ENRON where employees were pressured to buy stock options that were completely worthless. Why can’t we enable employees to receive some equity in the company for which they work AND ensure workers get accurate financial disclosure forms?

Republicans have brought this complex, eleven-bill package to the floor under suspension of the Rules, denying members the opportunity to offer amendments and have a robust fair debate. Just last month, that strategy led to the repeal of the “swaps push-out” rule, a crucial reform in Dodd-Frank. As this bill makes clear, the Republican strategy of jamming complex legislation through Congress will only continue, depriving the minority and the American public of the chance to provide meaningful input during the legislative process and threatening the provisions we put in place to protect our economy from another devastating financial crisis.

We must send a strong message that this is unacceptable.

I urge a “NO” vote, and reserve the balance of my time.