RM Warren Opening Remarks at Prudential Regulators Hearing

Thank you, Mr. Chairman. So, President Trump has had more than a year to keep his number one campaign promise to lower costs for American families, and boy, has he failed. Costs are going up across the board. Prices are up for groceries, utilities, healthcare, and the National Association of Home Builders says that, thanks to Trump's chaotic tariffs, it costs $11,000 more to build every new house in America. Meanwhile, job growth has slowed to a crawl, and 83,000 people working in manufacturing lost their jobs last year. Ordinary Americans are squeezed hard, but boy, it is a good time to be a Wall Street CEO. Last year, the CEOs of the six largest banks together earned more than a quarter of a billion dollars in compensation. Those banks paid out more than $140 billion in dividends and buybacks to wealthy shareholders. It is a record. The rich are getting richer, and everyone else struggles. In the Trump economy, it's Wall Street first and American families last. Now, we've seen this story before. We know how it ends. In the great financial crash of 2008, 10 million families lost their homes, the unemployment rate skyrocketed to 10%, and nearly $20 trillion in savings and retirement plans evaporated. Washington helped cause that crash by eliminating common sense guardrails that kept banks safe and focused on serving communities. When the crash hit, Washington bent over backwards to funnel trillions of dollars to bail out Wall Street. Wall Street executives who deserved handcuffs were instead rewarded with golden parachutes. It was brutal capitalism for families on Main Street, socialism for billionaires on Wall Street. The memories of a family being thrown out of its home because of a predatory mortgage, or of a 70-year-old grandmother coming out of retirement to work at Walmart because her pension vanished, did not fade. But Wall Street lobbyists and piles of campaign cash have worked hard to erase them. Now they have their champion in the White House, and he has assembled a team of Wall Street first regulators. Take the Federal Reserve Vice Chair for Supervision, Michelle Bowman. President Trump appointed her to the Fed during his first term. She helped deregulate Silicon Valley Bank and other large banks. And a few years later, those same banks failed, the second, third, and fourth largest bank failures in U.S. history. And was Ms. Bowman held accountable? Nope. President Trump gave her a promotion. Now she and Trump's other regulators are implementing Wall Street's wish list. And at the top of the list, weakening capital rules, including stress testing. Banks love debt. They want to make their bets using other people's money so depositors and taxpayers are left holding the bag if things blow up. Capital rules require banks to fund loans and investments with some of their own money so that they have skin in the game in those decisions. Strong capital cushions help the economy by reducing the likelihood of financial crashes and taxpayer bailouts. Now, megabanks are drawing down their capital cushions through higher payouts to wealthy executives and shareholders, increasing their risks. Regulators have also rubber-stamped mergers, allowed banks to engage in dangerous crypto activities, rescinded a key rule designed to drive investment in low-income communities, eviscerated fair lending standards, and taken financial cops off the beat, each cutting staff by 15 to 30 percent. The bank regulators have also terminated enforcement actions against JP Morgan, Wells Fargo, Citigroup, and Goldman Sachs, while failing to identify new lawbreaking on Wall Street. Either Wall Street bankers have suddenly stopped breaking the law or Trump enforcers are keeping their eyes deliberately closed. I'm betting on closed eyes. Warning lights in our overall economy are flashing red. President Trump is bringing the next great financial crisis closer into view, yet his regulators seem determined to serve only Donald Trump and his billionaire buddies. Thank you, Mr. Chairman.