Chapter 1: What are the implications of the Federal Reserve subpoenas?
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Let's turn to Washington. President Trump reaching across the aisle, asking Democratic Senator Elizabeth Warren to support his effort to cap credit card interest rates at 10% after facing opposition from his own party. The Republican Congressman French Hill, chairman of the House Financial Services Committee, joins us now from Capitol Hill to respond to that and a whole lot more.
Congressman, it's good to see you, sir. History is littered with examples, full of examples that when you introduce price controls, you end up with restricted supply. Congressman, is this proposal going to end up any differently?
Happy New Year, Jonathan. Great to be with you.
Chapter 2: How does Congressman Hill view President Trump's credit cap proposal?
Congratulations on becoming a dad. So happy for you and your family. Look, this proposal is a price control, and I think I've heard from Republicans in the House that they have concerns about it. What we are in agreement with President Trump on is that we want to reverse the curse of the Biden years and taxation, regulatory and government policies.
So we want to work to pass my 21st Century Housing Act, which would lower home construction costs. We want to pass the Main Street Capital Access Act. which would lower compliance cost and refocus the bank regulators on safety and soundness, tailoring regulations to bank complexity.
And when you think about the regional banks you just talked about and the community banks, particularly those banks under $10 billion, they make 60% of the one to four family home loans in this country. So we believe that with the tax benefits from the one big beautiful bill, lowering compliance costs, focusing and tailoring regulations,
and focusing on dropping the regulatory burdens and trying to build homes in this country. These are bullish signs for the GDP, for the nation. We don't want to do anything that throws off that gross domestic product. And one of the things I heard from colleagues is two-thirds of GDP in the U.S. is consumption. And so if credit availability is denied or reduced, that could impact growth for 2026.
Congressman, do you think the proposal as it stands could have a chilling effect on credit?
Well, I think this is what people that I've heard from in the House Republican Conference have said to me is they think, gosh, this could mean that those Americans with lower credit scores have their credit curtailed in some way, even by a temporary proposal like this.
And, you know, we've campaigned against the government price controls in the 2024 election and Kamala Harris's efforts to put in nationwide rent control, for example.
Congressman, which is why it's so curious, the president is getting on the phone with the likes of Senator Elizabeth Warren and continuously has this text exchange, we've learned through Axios, with Zoram Mamdani.
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Chapter 3: What is the impact of price controls on the economy?
Do you think he is moving too far to the left and almost out of where your party is?
Well, I just think that Republicans want to work with President Trump to accomplish his goal, reverse the curse of the Biden policies and regulation, taxation, open up the economy besides our tax policy and the big, beautiful bill. I really believe that our Main Street Capital Access Act
will make capital more available for small businesses all across the nation, produce economic growth, particularly in the home building area. Mike Flood's 21st century housing bill that we put together lowers regulatory costs on building new homes, opens up things like the home program and the CDBG program to private sector partnerships to build more housing. We want more housing available.
We want better and better prices. And that's the tack that we're taking. I think these are the priorities of the president.
Congressman, as the chair of the Financial Services Committee, have you spoken to Chair Jay Powell since the subpoena was delivered to him from the DOJ?
I have.
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Chapter 4: How could the proposed legislation affect credit availability?
Chairman Powell called and told me that this process was taking place.
And does he have plans to come to the Hill to testify?
Well, we've invited the chairman to testify for his semiannual Humphrey Hawkins testimony, and we're working out the date now. We'll do that typically in coordination both with the Fed and with the Senate Banking Committee so that we can get the Fed chairman up for his semiannual testimony on the Hill.
Congressman, do you agree with the efforts put forward by Senator Tillis talking about potentially stymieing any of the candidates that President Trump is putting forward or will put forward for the Federal Reserve until this subpoena is removed or this issue is resolved?
Well, you know, my attitude about this is really simple, which is Fed independence doesn't mean the Fed's immune from criticism or governors of the Fed are immune from criticism.
And if people have questions and concerns about the construction project down there, about how expensive it is to build something in Washington, D.C., how expensive it is to build something after a 40-year high in inflation from the Fed and fiscal policy mistakes made at the end of the pandemic, Those are legitimate questions.
But to try to criminalize it and threaten people with a grand jury over disputes about that construction, I just don't agree with that. And I think the Congress can do oversight about the construction project. And I think, as I said in my statement, I think this is a distraction.
from our partnership with President Trump in lowering cost of living for our citizens through increasing access to capital, lowering the cost of building a home in this country, getting the economy growing, along with all the improvements, the tremendous improvements we've had for working families that we passed in the one big beautiful bill last year.
Do you think that it's actually illegitimate, this particular subpoena?
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Chapter 5: What concerns does Congressman Hill have about the DOJ subpoena?
It hasn't been a distraction for markets, though. They pretty much shrugged it off. Do you think the markets don't view this as real threat to independence?
That's possible. I don't know that it's a threat to independence. I think it's a distraction to the work we're trying to do here to move the economy forward, to complement the big tax changes we made to benefit working families last year. We want to do the same thing this year.
to open up regulatory policy, make it easy not only just to permit the growth of the energy industry in the country and critical minerals. These are goals of the president. But we also want to reduce that regulatory burden on housing construction and capital access for the American economy.
And if we don't have a nominated and confirmed Federal Reserve chair, that's a distraction to getting that done in the right way. And I think it throws the president's mission off track. That's why I called it a distraction. I'm sticking with it.
Congressman, always appreciate your time, sir, and thank you for the congratulations. I promise you this, I'll introduce the little guy to SEC football later this year. I can't make a promise that he's going to be a Razorback fan, though, okay? He's going to be a winning team, French.
That's something we've got to talk about.
We'll try and work it out. Congressman, thank you. Congressman French Hill with the latest.
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