Proposed Republican cuts that could erode the ability of the Securities and Exchange Commission (SEC) to implement aspects of the Dodd-Frank Act are an effort "to re-deregulate the economy," Rep. Barney Frank, (D-Mass), told CNBC Wednesday.
"We’re at war. If we shut down the government, what are we going to tell Al-Qaeda? 'We’ll shoot you later?'”"
“This is not a budget-deficit issue,” said Frank, who is a ranking member of the Financial Services Committee and was co-sponsor of the legislation. “It’s an ideological fight.”
On Monday, the White House proposed a $3.7 trillion budget that offered $1.1 trillion in deficit reductions over 10 years. But Republicans said the budget cutting did not go far enough and chided the administration for not taking bolder steps. The GOP leadership is proposing that another $61 billion be slashed from the budget.
Frank has proposed increasing funding to the SEC by $13 million, a move he said would not add to the budget deficit, because the money will come out of the Treasury Department's international operations and the General Service Administration. He also said that the SEC is a moneymaker for the government.
The SEC is charged with implementing aspects of the Dodd-Frank Act, a sweeping piece of financial reform legislation signed into law last year by President Obama. As the SEC’s budget stands now, according to its chairwoman, Mary Schapiro, the agency is grossly underfunded.
The Dodd-Frank Act puts 30,000 more financial institutions under the supervision of the SEC, yet funding doesn’t exist at the agency to hire more staff or buy equipment necessary to carry out the work.
The clock is ticking: Spending legislation much be signed into law by March 4 to prevent a shutdown of the federal government. Frank said closing the government would have disastrous consequences for the country.
“We’re at war,” said Frank. “If we shut down the government, what are we going to tell Al-Qaeda? 'We’ll shoot you later?'”