President Obama is calling for significantly more funding for government regulatory agencies tasked with overseeing financial markets.
The White House budget request released Monday wants funding for the Securities and Exchange Commission boosted to $1.7 billion and for the Commodity Futures Trading Commission to $322 million for fiscal 2016. Those totals would represent increases of 15 percent and 29 percent, respectively. The CFTC and SEC are the two main independent regulatory agencies that rely on federal appropriations for funding.
Increased funding for the two agencies was one of the features of the “cromnibus” spending agreement reached in December touted by the Obama administration.
The government spending bill contained double-digit percentage spending increases for the agencies, which together oversee trading in stock, bond and derivatives markets.
Officials at the SEC and CFTC have warned that they lack the funding to monitor markets and prevent fraud. The CFTC, in particular, was tasked with overseeing new derivatives markets by the 2010 Dodd-Frank financial reform law, but it hasn’t seen its budget increase accordingly.
Republicans have said that the agencies have adequate funding if they stay within their mandates.
The White House pointed to the additional SEC and CFTC funding in the cromnibus in defending it from criticism from liberals in Congress.
Led by Sen. Elizabeth Warren, D-Mass., congressional liberals had objected to a provision in the bill that would roll back a Dodd-Frank regulation pertaining to derivatives. The Obama administration said that it also disapproved of that measure, but that the bill as a whole was worth supporting.
“There are a couple of provisions that are in the overall bill that are good for Wall Street reform. There are double-digit increases in funding for both the CFTC and SEC. These are two independent regulatory bodies that have a critical role in implementing Wall Street reform,” White House spokesman Josh Earnest said in a press briefing at the time.
The White House’s requests for funding of regulators have been ignored by congressional Republicans in the past. Monday’s proposals are not likely to find support on Capitol Hill. More likely, additional funding would come during a larger compromise bill such as the one brokered in December.
