NYT editorial: Who Will Rescue Financial Reform?

In what passes for self-restraint these days, House Republicans have been insisting that they do not intend to repeal last year’s Dodd-Frank financial reform law.

Not in one fell swoop, anyway.

A direct assault on Dodd-Frank would be so blatantly biased toward banks that it would be sure to provoke a public backlash. So the Republican plan is to delay and disrupt reform. The effort is partly ideological — an insistence that regulation is unnecessary, no matter the evidence to the contrary. It is also a campaign fund-raising ploy, because Wall Street will reward the opponents of reform. Of course, Democrats are themselves not indifferent to Wall Street campaign cash, which raises the question of how effectively they will counter the Republicans’ aims. Here are areas to watch.

DERIVATIVES Budget cuts could cripple the Securities and Exchange Commission and the Commodity Futures Trading Commission — which share the vital task of regulating the multitrillion-dollar derivatives market. The budget impasse in Washington has already frozen the agencies’ budgets, even as their rule-writing duties have exploded. Worse, prevailing Republican rhetoric, adopted in part by Democrats, portends more budget cuts, which would leave the agencies unable to enforce current rules, let alone new ones. Settling for less than President Obama’s requested amounts for the agencies would be acquiescing in the derailment of Dodd-Frank.

(More here.)