With a new administration, a new Congress, and new state legislators sworn in this year, LPL Government Relations is focused on continuing to provide all Americans access to objective financial advice.
But what can we expect with this new makeup of government? And how will LPL Government Relations continue to champion your causes?
Let’s dive into what we can expect at the federal level and what we’re focused on.
What to expect?
As with all new administrations, President Biden is expected to take on major policy initiatives. Democrats in both the House and Senate have historic slim majorities, meaning that both parties will need to work together, and Senate leaders will need to establish a power-sharing agreement.
In the first two years of the Biden administration, we expect a focus on regulatory changes—and specifically, using federal agencies to make these policy changes rather than the legislative process, given the slim majorities.
Some regulatory changes the Biden administration is expected to take on include:
- Stopping all regulatory projects, immediately. This is common among all incoming administrations and has been done for many years by past Presidents. President Biden has already signaled his intent to delay the effective dates for regulations that have not yet become effective.
- Resurrecting the Obama-era Department of Labor (DOL) Fiduciary Rule. Although vacated by the Fifth Circuit, the Biden administration is expected to resurrect the rule and potentially expand it to include rollover advice.
- Revise the SEC Regulation Best Interest. Gary Gensler, President Biden’s SEC chair, is likely to seek a uniform fiduciary standard for broker-dealers and investment advisors, revising Reg BI.
- Environment, social, and governance (ESG) Investing, and the applicability of ESG factors when recommending investment products.
- Worker classification, including the adoption of the ABC Test used in California and Massachusetts.
- SEC interpretation of investment advisor fiduciary duty, specifically around disclosures to mitigate conflicts of interest.
There are also policy goals that will require the legislative process. While it’s likely that each party will continue to publicly espouse partisan rhetoric, moderates and institutionalists will look to huddle and find opportunities for bipartisan cooperation on issues like retirement security. Major legislative initiatives to look for include:
- COVID-19 relief
- Remote notarization
- SECURE Act 2.0
- National privacy standard
- Tax credit for not reducing employee benefits during the pandemic
- SAFE Banking Act
- Remote and mobile worker relief for taxes
- Rollback certain elements of the Tax Cuts and Jobs Act of 2017
- The PRO Act / independent contractor status
- Ban of stock buybacks
- Financial transaction tax
- Ban on mandatory arbitration
Given the vast set of priorities from this administration, these are the areas that we’ll focus on in order to continue to protect our profession, your businesses, and your clients.
For more information or to get involved, please visit LPLGovernmentRelations.com.
If you have questions, please reach out to LPLGovernmentRelations@LPL.com.