As Republicans in Congress and the White House begin repealing and replacing the 2010 Dodd-Frank financial regulation bill, they need to remember something most of new media misses, which is that Wall Street's big banks aren't reliable friends of free-market conservatives in this effort.

The House Financial Services Committee is set on Tuesday to mark up its repeal and replace bill, the Financial CHOICE Act. This has Wall Street worried.

"We're not for wholesale throwing out Dodd-Frank," JP Morgan CEO Jamie Dimon said at a bankers conference right after the election. Goldman Sachs CEO Lloyd Blankfein said around the same time, "I wouldn't want regulation to be repealed in total."

Dodd-Frank, like most big-government regulations, irritates big businesses but also protects them from competition. Big, complex regulations impose costs that the big guys can afford, but the small fry can't.

Making it expensive and difficult to start and build a bank is very helpful to banks that are already big and established.

"More intense regulatory and technology requirements have raised the barriers to entry higher than at any other time in modern history," Blankfein said in 2015. "This is an expensive business to be in, if you don't have the market share in scale"

Gary Cohn, who was then a Goldman executive and is now a White House official, said early in the debate over Dodd-Frank, "we support measures that would require higher capital and liquidity levels, as well as the use of clearinghouses for standardized derivative transactions."

Dimon has described derivatives regulations and the Volcker Rule, which separates a bank's lending operations from its investment activities, as a "moat" that keeps out new entrants.

A forthcoming Manhattan Institute study reinforces this idea. Because of Dodd-Frank, small banks are combining faster with other small banks to become medium banks. But medium banks have stopped growing, because if they grow too big they crash into the law's too-big-to-fail regulations.

"The conclusion raises concerns that Dodd-Frank has created a protected class of financial firms with assets above $50 billion," the Manhattan Institute states in a write-up of the study, which has not been released yet. "Dodd-Frank did nothing to break up America's largest banks, but it also discourages new competition for the mega-banks that existed before Dodd-Frank."

In other words, only massive banks can afford to become dubbed "Too Big to Fail," and they know that they will never be challenged. So the regulatory cost of being so big is protection money.

A 2015 Harvard study detected banking consolidation by another measure. Small banks lost market share more rapidly after Dodd-Frank than they did between the financial crisis and Dodd-Frank. That is, community banks could weather the financial crisis that brought the U.S. economy to its knees, but they were no match for Sen. Chris Dodd and Rep. Barney Frank.

A community bank lobbyist, William Grant, told Congress in 2012, "The cost of regulatory compliance as a share of operating expenses is two-and-a-half times greater for small banks than for large banks."

Lawmakers always, by necessity, ask industries for their opinion about regulations that will affect them. The affected companies' special knowledge can inform policymaking. But Republicans make the mistake of trusting big business too much. This would be a costly error as Republicans debate what to do about financial regulation.

Because Dodd-Frank functions as a protective moat around big banks, Jeb Hensarling, Chairman of the Financial Services Committee, is the right man to take on the law. He has gone to war against big business many times. He almost single-handedly brought down the Export-Import Bank for a few months in 2015. Some Republican power-brokers have criticized him for not using his gavel to raise more money for Republicans from Wall Street.

The point of financial reform is not to help Goldman Sachs and JP Morgan, but to ward off another crisis while making sure citizens and small businesses can get the financing they need.

Small businesses get the majority of their financing from community banks. As those banks shrink, small businesses find it harder to grow. Small and growing businesses are the heart of job creation.

As Republicans tackle this Obama-era abomination, they need to ensure they don't listen too much to Wall Street, and instead keep an eye on Main Street.