WASHINGTON — Congressional Republicans are greeting the first anniversary of President Barack Obama’s financial overhaul law by trying to weaken it, nibble by nibble.
Wary of attempting to dismantle the entire statute and being portrayed as Wall Street’s allies — banks are among the nation’s most unpopular institutions — GOP lawmakers are attacking corners of it.
They can’t prevail because they don’t control the White House or Senate, but they may be able to force some compromises on agency budgets, pressure regulators and influence some of Obama’s nominations.
Days ago, one Republican-run House committee approved bills diluting parts of the law requiring reports on corporate salaries and exempting some investment advisers from registering with the Securities and Exchange Commission. Another House panel voted to slice $200 million from Obama’s $1.4 billion budget request for the SEC, which has a major enforcement role.
Meanwhile, Senate Republicans are continuing a procedural blockade that has helped prevent Obama from putting Elizabeth Warren or anyone else in charge of the Consumer Financial Protection Bureau, which opens its doors in two weeks.
The law hurts “the formation of capital, the cost of capital and access to capital, and you can’t have capitalism without capital,” said Rep. Jeb Hensarling, R-Texas, a leader of the House Financial Services Committee. “So Republicans in the House will be examining each and every one of the 2,000-plus pages” of the law, which he called “a job creator’s nightmare.”
Confident that Obama and the Democratic-controlled Senate can prevent the House from doing major damage, Democrats view the Republican drive as a political exercise — for now.
“It’s mostly setting a marker for the election. And it helps with their campaign contributions,” said Rep. Barney Frank, D-Mass., who chaired the Financial Services Committee last year and was a chief author of the law. “But it also tells people in the financial community that if they win the next election, they’ll be able to undo it all.”
Republicans say the overhaul went too far and has saddled banks and other companies with requirements that harm their competitiveness. The House Financial Services panel alone has held more than a dozen hearings on the law, in part to underscore to administration witnesses that some provisions — such as forcing banks to hold back capital as a hedge against losses — will hurt business, according to the committee’s chairman, Rep. Spencer Bachus, R-Ala.
What the law does
Key provisions in the financial-system overhaul:
• Creates a consumer-protection agency to oversee mortgages, credit cards and other financial products.
• Establishes a body of regulators to scan the economy for threats to the financial system.
• Requires banks to hold back money for protection against losses.
• Curbs the trading of derivatives, speculative investments partly blamed for the 2008 financial crisis.
• Gives the Federal Reserve powers to oversee huge companies whose failures could jeopardize the entire financial system.
The Associated Press
