Technical Fixes Prompt Suspicion From Dodd-Frank Backers

Bloomberg Businessweek
Dec. 10, 2012

U.S. lawmakers and lobbyists who once backed repeal of the 2010 Dodd-Frank Act are now pushing for technical fixes to the law, and they’re getting a skeptical reception from the measure’s advocates.

While some alterations to the act have bipartisan support in Congress, many Democrats say they remain wary of measures that might undermine the law that created the Consumer Financial Protection Bureau and mandated regulations to curb risky behavior by financial institutions deemed too big to fail...

Senator Mark Warner, a Democrat from Virginia and Dodd- Frank supporter, said he would like to see several alterations to the law, including an independent leader to replace the Treasury secretary as head of the Financial Stability Oversight Council, a panel created to spot systemic risk, as well changes to derivatives rules.

“The political context is such that it is either repeal or nothing, which is an absurd way to approach any major legislative activity,” he said of Dodd-Frank <a href="http://bipartisanpolicy.org/events/2012/10/launch-financial-regulatory-reform-initiative">during a speech before the Bipartisan Policy Center</a> on Oct. 18.

The focus on technical changes reflects a growing sense among Dodd-Frank opponents that the measure’s repeal is all but dead.

“The election result means the idea of repealing Dodd- Frank is not going to happen,” said Phillip Swagel, a former Treasury assistant secretary in the administration of President George W. Bush and now an economics professor at the University of Maryland’s School of Public Policy. “With that discussion over, it should be more possible to make smaller changes.”