The American banking system is poised for a revolution — one driven by technology and competition — but on Capitol Hill, it's facing a traffic jam. Maxine Waters, a progressive firebrand, chairs the House Financial Services Committee. The Senate remains under Republican control. The White House, for all its deregulatory pronouncements, seems too busy with other issues to devote much energy to major legislative changes to financial regulation.
Is this a recipe for gridlock? Maybe. But inaction would hurt millions of Americans who stand to benefit from greater access to innovative financial services. Moreover, increasing financial inclusion and lowering the regulatory burden on financial firms are not incompatible goals. In fact, a free-market agenda can achieve both. Despite the political conflict, there's a clear route for some much-needed reforms — places where both conservatives and progressives like Waters can find some common ground.
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