WASHINGTON, D.C. | April 21, 2016
This resolution is our way of honoring a commitment we made more than five years ago. Since the Department of Labor issued their first proposal to expand the definition of “fiduciary” in 2010, we have raised concerns about their approach. Not the intent behind the rule – the approach. We agree that retirement advisors should serve their clients’ best interests. Ensuring they do so is a worthwhile, bipartisan goal. The problem lies in how the department thinks we should do that.
For years, we pointed to the serious consequences of the department’s fiduciary proposal. We warned the rule would make it harder for low- and middle-income families to save for retirement. We explained how it would restrict the ability of individuals to receive some of the most basic financial advice. We cautioned that it would create new hurdles for small businesses wanting to offer their workers retirement options. And we made a commitment—to families, small business owners, and all Americans trying to plan and save for the future—that we would not sit idly by while the administration advanced such a flawed proposal.
In fact, at the very first congressional hearing on the department’s proposed fiduciary rule in 2011, I said that we should never lose sight of the real world impact proposed changes could have on the investments and long-term retirement security of workers and retirees. I also said that we need to challenge any proposal that could make it harder for working families to plan and save for retirement. And that’s exactly what we have done.
Through letters, hearings, and other oversight efforts, we encouraged the department to withdraw its misguided proposal and go back to the drawing board. Eventually, they did—only to release a similarly flawed proposal last year. Since then, we have continued our efforts to draw attention to the consequences of the latest fiduciary proposal and encourage the department to pursue a balanced approach. We even advanced a responsible legislative alternative, which I was proud to introduce. Our bipartisan solution, unlike the department’s proposal, would both require financial advisors to act in the best interests of their clients and ensure low- and middle-income individuals have access to quality, affordable retirement advice.
Unfortunately, this time around, the department chose to ignore many of the serious, bipartisan concerns related to their proposed rule. Instead, they finalized a rule last month that will create consequences working families and job creators cannot afford.
That rule is the reason we’re here today—to make good on a promise we made years ago to do everything we can to ensure all Americans can retire with the financial security and peace of mind they deserve. Reasoning with the department simply hasn’t worked, so it’s time to utilize another tool in the box: the Congressional Review Act
. This law allows Congress to pass a resolution of disapproval to prevent, with the full force of the law, a federal agency from implementing a rule or issuing a substantially similar rule without congressional authorization. The resolution we are considering today is the next step in fulfilling our commitment to deliver the kind of retirement security this country needs.