Amid an economic downturn caused in part by financial deregulation, it is odd to most people outside the Beltway that Congress should be actively considering (and indeed have passed in the House) a raft of proposals for more financial deregulation. Yet the politics of both parties require efforts to generate job growth, without spending or taxing, and some deregulatory proposals may plausibly do that. My testimony takes up three themes related to pending proposals to revise securities laws to (among other things) deregulate widely held but unlisted companies and banks, to permit unregistered “crowdfinancing,” and to loosen constraints on small public offerings:

• (1) the proposals under review all raise the same general trade-off, which is best understood not as economic growth vs. investor protection, but as increasing economic growth by reducing the costs of capital-raising vs. reducing economic growth by raising the costs of capital;

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