Yesterday, Treasury Secretary Timothy Geithner sent a letter to House Financial Services Committee Chairman Spencer Bachus and Ranking Member Barney Frank warning against proposed legislation that would significantly weaken and repeal vital Wall Street reforms.
He noted specifically that a proposal being considered today to repeal the government's authority to break up or unwind failing financial institutions "would critically undermine the government's ability to limit the damage to the economy in the event of future financial crises." Another proposal to change the funding structure of the Consumer Financial Protection Bureau "would weaken the ability of the Bureau to provide stronger protection to consumers against financial fraud and abuse."
Pointing to other pieces of legislation pending in the House of Representatives, the Secretary urged Congress to allow regulators to fully implement Wall Street Reform:
"The bills present issues that the regulators are still actively considering in their rulemakings. If enacted, the proposed legislative changes would undermine the integrity of the rulemaking process, further complicate the work of the regulators, and increase uncertainty for firms. Accordingly, Treasury believes that the proposed bills are at best premature and that the regulators should be permitted to continue their work through the rulemaking process."
You can read the Secretary's full letter here.
You can read coverage of the legislation here, here, and here.
Erika Gudmundson is New Media Specialist at the Department of the Treasury.