The House Appropriations Committee’s fiscal 2013 spending package was released today, causing a chorus of protests from financial regulators. The budget proposal would cut the CFTC’s budget by $25 million, while raising the SEC’s by $50 million. The Republican-led committee’s plan runs counter to the administration’s, which seeks significant increases in funding for the two agencies.
Critics of the bill, including Dodd-Frank Act co-sponsor Barney Frank and CFTC Chairman Gary Gensler, pointed out that budget cuts would make it impossible for the CFTC to carry out the expanded oversight of derivatives markets assigned to it by Dodd-Frank.
“The result of the House bill is to effectively put the interests of Wall Street ahead of those of the American public by significantly underfunding the agency Congress tasked to oversee derivatives,” Gensler said.
The Committee’s budget supports CFTC Commissioner Bart Chilton’s theory, articulated in a speech he made last month, of a D.C Quadrakill strategy used by lawmakers for bills they don’t like: 1. Kill bill, 2. Defund it, 3. Regulate it, and 4. Litigate it. It appears that House Republicans are applying the second stage of the strategy.
Read more about the proposed cuts.