Federal agencies are planning to add hundreds of employees each to manage the new authority granted to them by the financial regulatory overhaul.
Details on the growth of the federal government and its regulatory responsibilities evolved Thursday as agencies reported their progress implementing the Dodd-Frank Act.
Securities and Exchange Commission chairman Mary Schapiro said the Dodd-Frank Act requires her agency “to add approximately 800 new positions over time in order to carry out the new or expanded responsibilities given to the agency by the legislation.”
Commodity Futures Trading Commission Chairman Gary Gensler said his agency has “the resources to write the rules required by Dodd-Frank,” but it “will need more staff to implement and enforce them in the years to come.”
The Treasury Department said it “will be adding staff” due to the new law. “The number, however, will be skewed by the consumer bureau at least immediately,” said Steven Adamske, a Treasury spokesman, referring to the creation of the Consumer Financial Protection Bureau.
The Federal Reserve will increase its staff by “several hundred,” said a spokesman.
The Federal Deposit Insurance Corporation Board of Directors has already authorized the hiring of more than 1,600 new employees to “deal with anticipated bank failures,” and did not provide a number for anticipated hires due to the financial overhaul.
The primary authors of the Dodd-Frank Act defended the size and reach of the law bearing their names.
“Paying for the necessary regulatory improvements is trivial compared to the cost we would incur if we were to experience another financial crisis,” said Addie Whisenant, the press secretary for the House Financial Services Committee and Chairman Barney Frank (D-MA). “An improved regulatory structure is necessary both to minimize the possibility of another crisis and to insure that we have the tools to respond if one happens,” she said.
Senate Banking Committee Chairman Chris Dodd (D-Conn.) said “our bill is 848 pages long because times have changed …we were asked to reform the entire financial system and that can’t be done in a handful of pages.”
Opponents of the new financial law said regulators are implementing a growing bureaucracy that will hamper, not help, the financial system.
“Rather than fix the problem Dodd-Frank instead builds additional rooms onto a building with a collapsing foundation,” said Tom Quaadman, vice president of the U.S. Chamber of Commerce's Center for Capital Markets Competitiveness. “While hiring 800 workers is only a start in implementing the new law, we all face a deferred bill because our regulatory systems still have not been modernized to deal with a 21st century economy,” he said.
Senator Richard Shelby (R-Ala.), the top Republican on the Senate Banking Committee, derided the new law and said it “could potentially create a more complex, dysfunctional system” as “the real authors will be the bureaucrats and the financial regulatory agencies.”