Michael Barnier, the European Commissioner for Internal Market and Services, spoke against the rising tide this morning, throwing his full support behind implementation of Dodd-Frank final rules as scheduled. “I have heard calls here in the United States that the Dodd-Frank implementation should be postponed or weakened,” he said in a speech at the Brookings Institute. “Delay is not the answer. Europe is committed. We will deliver. And I call on the United States to do the same.”
Barnier’s stand in favor of full Dodd-Frank finalization this July puts him in dwindling company. Though CFTC Commissioner Bart Chilton has been adamant that no delay is necessary, some of his colleagues have been less enthusiastic. Last week a number of financial service organizations, including the Futures Industry Association and the U.S. Chamber of Commerce, wrote a comment letter to the CFTC and SEC urging them to take a few months to re-propose derivatives rules in a way that shows a coherent framework rather than rushing to implement them all haphazardly in July.
These objections all pale in comparison to the hostility festering in Congress. Legislators (mostly Republicans) have been trying to trip up the Act at every turn. In the House, a bill is making its way to the floor which would delay implementation by a year and a half, until December 2012, and orders various regulatory agencies to rethink their policies. Though the bill’s sponsors claim they are only trying to ensure the Act is properly implemented, Dodd-Frank supporters have accused them of trying to gut it of momentum so that they can strip it of power later. Meanwhile, a vicious hearing is dragging on, with Elizabeth Warren, the President’s likely nominee to head the new Consumer Financial Protection Bureau, at its center. The CFPB is considered one of the strongest provisions in Dodd-Frank, and attempts to dismantle it have been relentless.
There are other, less partisan objections being raised in other corners. Fears about the widening gap between American rules and legislation forming in other countries prompted over half of the New York Congressional Delegation to write an open letter to regulators and has spawned several conferences and editorials. As head of one of those regulatory bodies, Bernier did urge the creation of “common rules to ensure market safety, soundness, and access.” But revision does not necessarily mean hesitation, and for Bernier the time “to deliver on our regulatory promises” is now.