A Republican push to overhaul US financial rules put in place after the 2008 crisis is gaining momentum.
The US House of Representatives is expected to vote on a bill on Thursday that would scrap federal bailout power, ease requirements on banks and weaken the Consumer Financial Protection Bureau.
Supporters say the proposal simplifies regulation that has stifled growth.
But opponents describe it as a “wish list” crafted by banks.
Few expect the sprawling, nearly 600-page document – which touches on everything from payday lending to bank bailouts – to become law in its current form.
It faces fierce opposition in the Senate, where Democrats have a higher share of the votes.
But success in the House would be viewed as a sign of support for some of the other, more limited proposals that are being considered.
“It’s a good start to putting a comprehensive reform bill on the table and it’s very aggressive, so it really sets the high-water mark for what can be done for regulatory relief,” said Paul Merski, executive vice-president for congressional relations and strategy for the Independent Community Bankers of America, which represents the interests of smaller banks.
What’s this fight about?
The main target of the Financial Choice Act is a set of rules introduced after the financial crisis, in the form of a law known as the Dodd-Frank Act.
Supporters say Dodd-Frank has made the financial system safer, increasing protections for consumers, improving stress tests and forcing large financial institutions to hold more money for use in the event of a financial shock.
But opponents, which include community banks and other financial institutions, say it created an overly complex set-up that has inhibited growth, particularly for small businesses.
“There is a better way,” said Rep Jeb Hensarling, a Texas congressman who sponsored the bill. “We will replace complexity with simplicity.”
What would the bill do?
The bill, which has White House support, would abolish bailout authority and weaken the Consumer Financial Protection Bureau, the agency that has pursued banks and other firms for wrongdoing during the crisis.
It would also loosen rules on home loans and allow banks to opt out of Dodd-Frank rules if they maintain a 10% ratio of capital to assets.
The Congressional Budget Office estimates the changes would lower the federal deficit by about $24bn.
But the proposal goes farther than just repealing Dodd-Frank.
For example, it would require shareholders to own more of a company in order to introduce a shareholder proposal and abolish a new rule that requires financial advisers to act in the best interests of their client.
Proposals like that have drawn pushback from a wide range of interests, including large investment firms and consumer groups.
“We think it is a really dangerous bill that would put our financial marketplace in a weaker position than it was,” said Rachel Weintraub, legislative director and general counsel at the Consumer Federation of America.
Economists also dispute claims the bill has hobbled lending and other financial activities.
“Dodd-Frank is a highly imperfect bill, but it was a massive step in the right direction on many fronts,” said Francesco Trebbi, a professor of economics at the University of British Columbia in Vancouver, whose work has found no evidence that Dodd-Frank limited liquidity.
The Financial Choice proposal didn’t move forward last year, but Republicans passed it out of committee last month on a strict party line vote. It also has the backing of the Donald Trump administration.
Mr Merski, the lobbyist for smaller community banks, said he thinks there is support in the Senate for some financial rule reform – at least when it comes to community banks, which have seen their numbers shrink in recent years.
“We’re realistic in working with the Senate, of moving regulatory relief maybe piecemeal,” he said.
Barney Frank, the former US congressman from Massachusetts who was an architect of the Dodd-Frank law, said he thinks there is bipartisan willingness to provide relief for smaller institutions.
But beyond that, he said, Thursday’s vote is “theatre” that gives strict anti-regulation conservatives their moment.
“It has no chance of becoming law,” he said.
Ms Weintraub said she remains worried the proposals will advance.
“We’re concerned and we will be working hard to make sure it doesn’t go anywhere,” she said.