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READ: DeSantis Pushed for Bank Deregulation Before Silicon Valley Bank Failure
After Silicon Valley Bank’s collapse last week, Ron DeSantis immediately tried to spin away the bank’s failure with desperate conservative spin. But according to a new report from CNN, what DeSantis failed to mention was that, as a member of Congress, he was an outspoken champion for lifting regulation on small and mid-sized financial institutions like SVB and has long worked to roll back regulations that loosened oversight of mid-sized banks like SVB.
“In the wake of Silicon Valley Bank’s demise, Florida Gov. Ron DeSantis pointed fingers at several culprits, including the company’s diversity initiatives and federal regulators who he said “always seem to whiff” at preventing a financial crisis.”
“But left out of DeSantis’ comments was his own record on banking regulations. As a member of Congress, DeSantis was an outspoken champion for lifting regulation on small and mid-sized financial institutions, and in 2018 he voted for a bill that eventually became law loosening oversight of mid-size banks like Silicon Valley Bank.”
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“DeSantis had little to say publicly about the 2018 law, one of his last major votes as a member of the US House of Representatives before he resigned to run for governor – but the year before, he repeatedly boasted about Republican votes to repeal Dodd-Frank in interviews on Fox Business Network.”
“During one such appearance in June 2017, DeSantis forcefully argued for easing restrictions on banks that were lower on the financial food chain.”
““You know, the Dodd-Frank piece I think would be very good for the economy, moving away from too big to fail and really lifting the burden off a lot of our small and medium-sized financial institutions who have just gotten clubbed by Dodd-Frank,” DeSantis said.”
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“DeSantis is not alone among 2024 contenders in supporting the rollback of Dodd-Frank. Besides Trump, who successfully urged Congress to ease banking regulations, potential candidates Sen. Tim Scott of South Carolina, former Rep. Liz Cheney of Wyoming and now-South Dakota Gov. Kristi Noem voted for the 2018 law.”
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“But DeSantis’ past calls for a more laissez-faire approach to the financial industry are also at odds with his more recent moves to punish banks and sever ties with financial institutions that consider factors like the environment and social good in their investment and lending strategies, a business framework known as environmental, social and governance, or ESG. DeSantis on Sunday faulted progressive corporate policies for the demise of Silicon Valley Bank.”
““They’re so concerned with (diversity, equity and inclusion) and politics and all kinds of stuff. I think that really diverted from them focusing on their core mission,” DeSantis told Fox.”
“The comments parroted a report over the weekend from another news organization in Rupert Murdoch’s media empire, the New York Post, which published a story outlining the bank’s diversity and inclusion efforts. Asked what DeSantis was referencing in his comment, his office declined to elaborate.”
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“Unsaid in DeSantis’ criticism is Florida’s financial ties to SVB. As of last June, Florida’s pension system had $1.7 billion invested in funds managed by SVB Capital, the investment arm of the financial group behind Silicon Valley Bank. That figure has doubled since DeSantis became governor. DeSantis is one of three trustees to the State Board of Administration, the body that oversees the state’s pension funds.”
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“DeSantis’ push to unravel Dodd-Frank started during his successful first race for a Florida congressional seat in 2012, when he ran as a tea party conservative whose platform called for repealing Dodd-Frank and the Sarbanes-Oxley Act – a bill that passed overwhelmingly in 2002 with only three combined no votes in the House and Senate following the accounting scandals at Enron and WorldCom.”
“After he won, DeSantis helped found the conservative House Freedom Caucus, and he worked with other conservatives to make repealing Dodd-Frank a priority. Early on, DeSantis specifically focused on rollbacking rules for community banks and repeatedly voted for legislation repealing large portions of the law.”
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“Four days after it passed, DeSantis appeared on “Mornings with Maria” on Fox Business where he argued that the bill would free up lending for small businesses. DeSantis contended, “It’s really the smaller- and medium-size institutions that get hurt” by Dodd-Frank.”
“He lamented that it was unlikely the Senate would take up the House bill. Instead, the Republican-controlled Senate passed its own bill in 2018, with support from 17 Democrats, and sent it to the House. The Senate bill did not repeal the Orderly Liquidation Act but it included fewer regulations on mid-sized banks.”
“DeSantis voted for it, and Trump signed it into law.”