Himes votes for Dodd-Frank revision; Esty against

Rep. Jim Himes was one of 29 Democrats to vote in favor of legislation to trim Dodd-Frank.

Rep. Jim Himes was one of 29 Democrats to vote in favor of legislation to trim Dodd-Frank.

The Republican-dominated House today overwhelmingly approved legislation to trim back the 2010 Dodd-Frank law, with Rep. Jim Himes voting “yes.”

The bill, the “Promoting Job Creation and Reducing Small Business Burdens Act,” passed the House by a 271-154 vote. Himes was one of just 29 Democrats voting in favor of it, joining 242 Republicans. A total of 153 Democrats and one Republican voted “no.”

The legislation faces an uncertain future with the White House on Monday threatening a veto, saying it puts “working and middle-class families at risk while benefiting Wall Street and other narrow special interests.”

At issue is a part of the bill that extends the deadline for banks to divest themselves of collateralized loan obligations, CLOs, which are amalgams of business debt marketed through hedge funds and private equity firms. The bill would delay the deadline from 2017 to 2019.

Himes’ office did not release a statement after he voted to approve the measure. But in an interview Tuesday, Himes said that while he was “ambivalent” about the CLO element of the bill, he did not believe it to be a threat to the overall structure of Dodd-Frank, which he helped write in 2010 as a former Goldman Sachs executive well versed in the intricacies of Wall Street transactions.

“I’m sensitive to the idea that people say `My gosh, is this just the start of the destruction of Dodd Frank?”’ Himes said in the Tuesday interview. “I can tell you personally that I will fight tooth and nail to prevent that from happening.’’

Aimed at reining in esoteric Wall Street trading in the wake of the 2007-2008 financial crisis, Dodd-Frank has been the pinata of Wall Street lobbyists and Republican allies on Capitol Hill since its passage in 2010.

Rep. Jeb Hensarling, R-Texas, chairman of the House Financial Services Committee, said the bill’s various parts are “modest, modest attempts to ensure that small businesses could still survive in an otherwise onerous Washington regulatory climate.”

Republicans have tried to characterize efforts to rein in Dodd-Frank as benefiting Main Street small businesses and banks. But research by SNL Financial showed that 69 percent of CLOs are held by four large banks: JP Morgan, Wells Fargo, Citigroup and State Street Bank (SSB).

Rep. Elizabeth Esty voted against the bill. But last week, she voted in favor of the exact same measure, which was defeated because it lacked the two-thirds majority necessary when legislation is fast-tracked to the House floor.

Why the switch? “I’ve come to the conclusion that this bill goes too far in rolling back protections and unnecessarily extending delays on the implementation of Dodd-Frank,” Esty said in a statement. “We need a better bill with more modest reforms.”

Rep. Rosa DeLauro also voted “no.”

Daniel Freedman