GOP budget steers clear of Dodd-Frank repeal

By Peter Schroeder - 03/20/12 10:18 AM ET

House Republicans offer up tough words for the Dodd-Frank financial reform law in their latest budget proposal, but stop short of calling for it to be erased altogether.

In the GOP presidential primary, the Wall Street overhaul is at the top of every candidate's list of programs that would immediately be on the chopping block in a Republican White House, uttered alongside President Obama's healthcare reform law.

Former House Speaker Newt Gingrich (R-Ga.) has even gone so far as to say he would repeal the law, along with healthcare reform and the Sarbanes-Oxley corporate accounting law, immediately after his inauguration.

But in the budget proposal released Tuesday by Rep. Paul Ryan (R-Wis.), there is simply a promise to "revisit" the legislation and eliminate certain provisions that could encourage future bailouts. That same budget calls for the repeal of the healthcare reform law.

The proposal assails Dodd-Frank on several fronts, calling it a flawed effort that puts too much power in the hand of unelected bureaucrats, creates hundreds of new rules, and could actually ensure future bailouts if large financial firms collapse.

But the budget also makes clear that Republicans do not believe the financial sector should go completely unwatched, adding that the government has a "critical role" in overseeing markets and punishing those who break its rules.

The tempered tone indicates a difference between how heightened regulations on the financial sector are viewed on Capitol Hill versus the sound bite-laden primary-campaign trail. Lawmakers who actually have the power to alter the law have so far steered clear of outright repeal attempts.

In the House, legislation has been introduced to repeal the law outright, but has attracted just 11 co-sponsors, and no members of House leadership. A similar bill in the Senate has pulled in some top GOP officials, including Republican Leader Mitch McConnell (Ky.), but such a bill faces extremely long odds in a body controlled by Democrats.

In the House, where Republicans do control the levers of power, the GOP instead has pushed a number of small, targeted bills that change or repeal specific provisions of the law, instead of a sweeping overhaul. They have also put pressure on regulators to avoid writing onerous rules, and have resisted White House attempts to expand their budgets to meet their expanded Dodd-Frank obligations.