Obama administration fires back at Dodd-Frank critics

The Obama administration is pushing back at criticism from Republicans and Wall Street over the Dodd-Frank overhaul of financial rules, saying the legislation is being implemented quickly but carefully.

"We will continue to oppose efforts to slow down, weaken, or repeal these essential reforms," Deputy Treasury Secretary Neal Wolin said.

Wolin on Tuesday addressed a laundry list of negative reviews the law has received, from its treatment of derivatives to the speed with which it is being implemented to the consumer protection bureau it created.

In a speech at Pew Charitable Trusts in Washington, Wolin said the same critics that had said the law was too vague when it was passed and called for details to be filled in quickly were now saying the implementation was moving too swiftly. 

“There will, of course, continue to be disagreements and opposition as we move forward. There will be critics and naysayers,” Wolin said. “But those who are charged with implementing reform have not forgotten why we needed reform.”

Meanwhile, top Republicans on Capitol Hill have signaled in recent months that they will try to chip away at the law, which President Obama signed roughly nine months ago. Rep. Spencer Bachus (R-Ala.), chairman of the House Financial Services Committee, also responded to Wolin’s Tuesday speech by continuing to critique the speed at which Dodd-Frank is being implemented. 

“At the current breakneck pace, it is difficult for individual firms — especially small businesses — and the public at large to meaningfully participate and offer their insights and observations,” Bachus said. 

Top Republicans on the House Financial Services and Agriculture panels announced last week that they had introduced a measure that would push the implementation of the Dodd-Frank section dealing with derivatives back 18 months. GOP lawmakers have also proposed installing a five-person board to head the Consumer Financial Protection Bureau instead of a single director. 

For their part, groups like the U.S. Chamber of Commerce have criticized what they call the lack of transparency in how rules are being developed for the Financial Stability Oversight Council (FSOC), a body created by Dodd-Frank that counts top federal regulators as members. 

At Pew, Wolin fired back over the FSOC, saying it was more transparent than any regulatory body he had seen. He also looked to counter criticisms over Dodd-Frank’s potential effects on American firms in the global economy and how coordinated the law’s implementation has been.

And the deputy secretary pushed back on those who have questioned the financial cost of Dodd-Frank, saying detractors who want to take funding away from implementation are trying to weaken the law’s reforms. 

“What happened in 2008 and in 2009 was enormously costly — vastly more costly than almost anything else we could imagine, and overwhelmingly more costly than implementing the various pieces of Dodd-Frank,” Wolin said.