If Obamacare is the worst piece of legislation passed by Obama and the Democrats, Dodd-Frank is clearly close behind on the list. This pernicious bill, sponsored by the instigators of the financial and housing crises, will permanently alter our financial markets for the worst just as Obamacare will kill the healthcare sector if it’s not repealed. I’ve met many small business owners who are contemplating a different career because of the crushing burdens from the new financial regulations.
Dodd Frank created the Financial Stability Oversight Council to enshrine “too big to fail” as a permanent government policy. This institution would vitiate the bankruptcy process and allow the federal government to take over any entity that it deems vital to the rest of the economy. Dodd-Frank also vested the Commodity Futures Trading Commission (CFTC) with the power to make infinite and officious regulations that distort the derivatives market. Nobody knows how badly the market will be distorted as a result of these regulations, but we’ll probably be debating new programs in ten years from now to fix the problems created by the CFTC.
One of the worst aspects of the Dodd-Frank regime is the creation of the unaccountable Consumer Financial Protection Bureau (CFPB). It enjoys unchecked and unparalleled regulatory powers over consumer financial products and services. These zealous bureaucrats will limit consumer choice and create superfluous and onerous obstacles to obtaining credit. Most egregiously, the Dodd-Frank law gave the CFPB autonomy from the annual appropriations process by housing it within the Federal Reserve.
It’s quite peculiar that there hasn’t been a wholesale effort to repeal Dodd-Frank or at least significant parts of the law. Nonetheless, House Republicans instituted some minimum limitations in their version of the FY 2013 Financial Services Appropriations bill. The extra funding for CFTC regulations was stripped out and the CFPB would be subjected to the annual appropriations process. Unfortunately, the same cannot be said for their fellow Republicans across the dome.
Yesterday, the Senate Appropriations subcommittee on Financial Services passed the FY 2013 Financial Services Appropriations bill. The bill appropriates $245 million for implementation of Dodd-Frank and beefs up the budget of the CFTC by 50%. It obviously contains no rider to subject the CFPB to the annual appropriations process. Additionally, like all of the appropriations bills passed so far, this one follows the spending levels set by Reid and Obama instead of those established by the House budget. It appropriates more than $1.3 billion more than last year’s spending levels. The bill was approved by voice vote.
The full Appropriations Committee will mark up the bill on Thursday. Please call the Republican members of the committee and tell them to stop consummating Obama’s most offensive acts into law. Also, tell them to side with Republicans on the issue of overall spending levels in the bill, instead of doing the bidding of Harry Reid and Barack Obama.
Senator Jim DeMint has introduced an amendment to the farm bill that will repeal Dodd-Frank - lock, stock, and barrel. The vote, assuming Harry Reid allows it to occur, will be very illuminating.
Cross-posted from The Madison Project