If the nestling of a provision effectively repealing a key provision of the Dodd-Frank financial regulation law in a must-pass appropriations bill alarms you, perhaps you should go back and read (or re-read, as I did this week) Haley Sweetland Edwards’ brilliant article from the March/April 2013 issue of the Washington Monthly predicting the various avenues Wall Street lobbyists would pursue to unraval Dodd-Frank or neutralize its effectiveness. Here’s one pertinent passage:
By attaching riders to appropriations bills, Congress can simply forbid an agency from using its money to enforce one specific rule or another—and, of course, an unenforced rule is a dead rule. Lawmakers can do that even if Congress has passed another law that pointedly mandates that an agency take the action in question….
Using the same mechanism, Congress also has the power to defund or severely underfund any agency that relies on congressional appropriations, including the CFTC and the SEC—a guillotine it has successfully used for decades. Just last year, for instance, the House Appropriations Committee cut the CFTC’s annual budget by $25 million, leaving it with an anemic $180 million. (For a sense of how little money this is, consider that San Bernardino, a county of about two million people in California, spends more than $180 million just on its public works department.) In 2011, congressional opponents of financial regulation blocked any increase in the SEC’s budget, despite or perhaps because of the agency’s massive new workload with Dodd-Frank. The Republicans’ argument against funding the independent agencies is delightfully absurd: since the agencies have not written and enforced rules fast enough, Congress should “punish” them, rather than “reward” them with adequate funding.
The appropriations rider followed by taking enforcement agencies’ funding hostage is precisely the one-two punch used by Wall Street lobbyists and their Republican allies to get language into the “cromnibus” effectively reclaiming banks’ ability to use government-guaranteed depositors’ money to back risky derivatives swaps.
In exposing the present and future lines of attack on Dodd-Frank, Haley Edwards was burnishing an old WaMo tradition of mastering the multi-dimensional chess game of Washington across all its playing boards in Congress, the bureaucracy, election campaigns, and media. It’s not a kind of journalism suitable for publications devoted to “winning the morning” or pursuing a proprietor’s pet causes. But it’s valuable, and requires both independence and a sense of mission. And that’s why we are bold to ask readers to help keep the WaMo tradition alive with a donation in whatever amount you can afford. We appreciate it, and will put these resources to good use.
