Today Trump signed the executive order, requesting Treasury Department to investigate financial regulations, enacted by the Obama administration after the financial crises of 2008. The order is targeting the controversial Dodd-Frank Act. The second directive halts the Labor Department rule that requires brokers to act in a client’s best interest, rather than seek the highest profits for themselves, when providing retirement advice. Those executive orders were long expected, as they reflect Trump’s promise to reduce the number of regulations and let businesses function more efficiently. Bloomberg reports:
President Donald Trump will order a sweeping review of the Dodd-Frank Act rules enacted in response to the 2008 financial crisis, a White House official said, signing an executive action Friday designed to significantly scale back the regulatory system put in place in 2010.
Trump also will halt another of former President Barack Obama’s regulations, hated by the financial industry, that requires advisers on retirement accounts to work in the best interests of their clients. Trump’s order will give the new administration time to review the change, known as the fiduciary rule …
The orders are the most aggressive steps yet by Trump to loosen regulations in the financial services industry and come after he has sought to stock his administration with veterans of the industry in key positions. His plans are sure to face fierce criticism by Democrats who charge that Trump is intent on undoing changes designed to protect everything from average investors to the global banking system. (Read the full article)
In order to eliminate the regulations, Trump needs to get congressional approval.
Following the new president’s lead, congressional Republicans on Friday started chipping away at Dodd-Frank, one of Mr. Obama’s signature achievements. The Republicans used an unusual parliamentary procedure to repeal a rule that stems from the law with only a majority of votes rather than the 60 votes needed to overcome a filibuster.
The Senate voted 52 to 47 to void the rule, which requires oil companies to publicly disclose payments they make to governments when developing resources around the world. The rule, which Dodd-Frank assigned to the Securities and Exchange Commission to enforce, was tangential to Dodd-Frank’s mission of reforming Wall Street, but lawmakers included it anyway with the hope of exposing bribes and corruption…
Friday’s Senate vote, which came after the House voted to repeal the rule, was the congressional Republicans’ opening salvo on Dodd-Frank. As long as President Obama was in power, Republicans had limited ability to attack Dodd-Frank, which was enacted in 2010. In 2014, they managed to gut a financial derivatives rule as part of broader spending bill, but other tweaks have been relatively modest.
Now emboldened, House Republicans are also moving legislation to “repeal and replace” Dodd-Frank, though they would need 60 votes to accomplish that. And they are considering potential ways to use the budget process to defund some aspects of the law, all of which comes on top of the president’s executive actions.
The move to eliminate the Dodd-Frank financial regulation sturred a lot of criticism:
The meeting underscored the degree to which the architects of Mr. Trump’s economic strategy are now some of the people he denounced in his campaign, which ended with a commercial that described “a global power structure that is responsible for the economic decisions that have robbed our working class, stripped our country of its wealth and put that money into the pockets of a handful of large corporations.” …
The actions are the latest sign that Mr. Trump, despite striking a populist tone during the campaign, is working to accommodate Wall Street and other corporations.
“The administration apparently plans to turn over financial regulation to Wall Street titan Goldman Sachs, and make it easier for them and other big banks like Wells Fargo to steal from their customers and destabilize the economy,” said Lisa Donner, executive director of Americans for Financial Reform, an advocacy group that supports Dodd-Frank. “That betrays the promises Trump made to stand up to Wall Street, and it will have dire consequences if he’s successful.” (Read the full article)