WASHINGTON – Rep. Spencer Bachus (R-Ala.), chairman emeritus of the HouseFinancial Services Committee, had good news for credit unionsduring his speech Tuesday morning at CUNA's Governmental AffairsConference.

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The powerful Republican drew applause from the crowd when hesaid the House “may revisit the Durbin Amendment,” because restrictions on debit card revenuehave affected local institutions, not large financial institutionsas intended.

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He also said he thinks there will be bipartisan support toremove some parts of the Dodd-Frank Act that apply to small creditunions and banks

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Also from 2013 GAC:

Bachus also spoke extensively on the looming sequestration deadline of March 1, when automatic spending cutswill go into effect.

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“No one thought we would be where we are,” Bachus said ofCongress' inability to resolve budget issues before thedeadline.

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“That's one thing Democrats and Republicans agreed upon, thatthis won't happen. We were told by our leadership this won'thappen. And the president never thought it would happen. We thoughtit would give us two months to come together and reduce the deficitby $1.4 to $2 trillion. But that's not happening, and now we'refacing March 1.”

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Bachus said cutting discretionary spending, particularly to thecountry's infrastructure, was a big mistake. While it's good newsdiscretionary spending cuts have cut the annual deficit from $1.6trillion in 2009 to an estimated $800 billion this year, he warnedthat the country will eventually have to make up postponedinfrastructure improvements.

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Instead, mandatory spending on entitlement programs, which aredriving the country's long-term debt, should be cut instead, theAlabama Republican sad.

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He predicted that Federal Reserve Chairman Ben Bernanke willtell the House Financial Services committee during a hearingWednesday that entitlement programs must be cut, and soon.

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“The only way we've been able to exist and run with thedeficits we have is because of the Federal Reserve,” he said. “Theyget a lot of blame, but they've held interest rates very low.That's allowed us to finance our debt at a much lower cost. But Ican tell you it would be an accounting and economic nightmare ifinterest rates kick up.”

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In fact, because so many countries have followed the samemonetary policy, Bachus warned that the U.S. could get caught up incurrency wars as countries try to devalue their currency. Thatcould lead to trade wars and inflation, he said.

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