Republican House Financial Services Committee Chairman Jeb Hensarling, an early opponent of Dodd-Frank, dismissed Obama’s meeting with the regulators, saying, “Much like Obamacare, Dodd-Frank is an incomprehensively complex piece of legislation that is harmful to our floundering economy and in dire need of repeal.”
The law set up a council of regulators to be on the lookout for risks across the finance system. It also created an independent consumer financial protection bureau within the Federal Reserve to write and enforce new regulations covering lending and credit. And it placed shadow financial markets that previously escaped the oversight of regulators under new scrutiny, giving the government new powers to break up companies that regulators believe threaten the economy.
But because of the complexity of the industry, the law gave regulators extended time to write the new rules that would enforce its provisions.
So far, regulators have missed 60 percent of the rule-making deadlines, according to an analysis by the law firm of Davis Polk, which has been tracking progress on the bill. Even so, the rules are so complicated that the ones already written have filled about 13,800 pages, compared with the 848 pages in the law itself.
“I would have to give it a mediocre grade at this point,” said Sheila Bair, the former chair of the Federal Deposit Insurance Corp. “Most of the rules have not been finalized. A lot of them haven’t even been proposed yet. When some of the rules have been proposed, they’re highly complicated, they’re riddled with exceptions, they’re watered down.”
Dennis Kelleher, president of Better Markets Inc., a bank watchdog group, said Obama needs to hold monthly meetings with regulators and fight for more money for the financial regulators to do their job.
“Only that level of consistent presidential leadership and involvement will turn the tide against Wall Street’s relentless attacks, which is what has killed, weakened and delayed so much of financial reform,” Kelleher said.