GOP, Dems again square off on funding for financial regulators

And Rep. Maxine Waters (D-Calif.), the ranking member of the committee’s subcommitee on capital markets and government-sponsored enterprises, called it “interesting” that Republicans are calling for a return to fiscal 2008 spending levels in a budget resolution.

“It’s interesting because that was the year in which our financial markets collapsed,” she said.

“I understand that Republicans are concerned about spending. Democrats are concerned about the deficit too. However, when we…blindly take an axe to the budget instead of a scalpel, we are placing our security—the security of our financial markets in this case—at risk.”

Rep. Scott Garrett (R-N.J.) responded by saying that given the government’s fiscal position, regulators need to learn to do more with less.

Big spending boosts for financial watchdogs “would further the mindset that our nation’s problems can be solved with more spending, not more efficiency,” he said in a statement. “Government agencies must learn to operate effectively within their budgets like American families and businesses do every day as we work to get our fiscal house in order.”

Garrett is the chairman of the subcommittee on capital markets and government-sponsored enterprises.

Following the enactment of Dodd-Frank, the White House requested significant budget boosts for the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC), the two agencies taking on a large share of the workload for implementing and enforcing the law. The heads of both agencies have said they need to hire hundreds of new employees to handle the new responsibilities, and that current funding levels are far from sufficient.

However, lawmakers were unable to agree on an omnibus spending bill during 2010’s lame duck session, instead passing a short-term continuing resolution (CR) keeping the government funded through March 4. That CR kept those agencies funded at pre-Dodd-Frank levels.
With Republicans now in charge of the House, focused on cutting spending, and strongly opposed to Dodd-Frank, those additional funds could be hard to come by.

This post updated at 1:07 pm.