Bye-Bye Basel???
Later this week, HFSC’s Financial Institutions Subcommittee plans finally to hold a long-delayed hearing scrutinizing another aspect of controversial capital proposals: how closely these hue to global norms and, if they do, the extent to which U.S. agencies are sacrificing U.S. interests in pursuit of global comity. The GOP hasn’t much use for most of this comity if it comes attached to new rules, and this point will be more than clearly expressed at the hearing. Democrats generally don’t expend much political capital defending global institutions. Indeed, when these threaten home-town interests, they join with Republicans as Sen. Brown (D-OH) did in 2014 when it came to passing legislation demanding that international insurance rules be significantly altered in concert with new transparency standards forcing U.S. agencies to tell Congress what they might be about when it came to endorsing future global insurance proposals (see FSM Report INSURANCE41). This time around, House bills are pending to force similar transparency and limits when it comes to global banking rules. We doubt Sen. Brown this time will agree to them, but it will first be up to Chairman McHenry (R-NC) to decide the next steps. These are likely to include mark-up, but the panel has a lot else to do on its other issues more critical to the chairman – e.g., crypto legislation – caught up in the prolonged speakership battle.