Trump to take steps rolling back financial regulations
WASHINGTON — President Donald Trump will begin work Friday dismantling the financial regulations enacted after the 2008 economic crisis, hours after the first major economic report of his administration is released.
Trump’s executive moves won’t have an immediate effect on Wall Street oversight. But they’re likely to draw sharp criticism from Democrats and reform proponents who say the regulations that the President is looking to scrap could prevent another meltdown.
In two executive actions, Trump plans to direct his administration to evaluate regulatory action taken by his predecessor, Barack Obama, with an eye toward eliminating what his advisers say are burdensome rules on financial services firms and consumers.
He’ll also force the delay of an Obama-era rule that required retirement advisers to act in their clients’ best interests.
The midday moves will come after the Labor Department releases jobs figures from January. Hiring rebounded sharply under Obama following the financial crisis, but Trump has previously questioned the accuracy of the monthly reports from the Bureau of Labor Statistics.
He’ll sign his actions following a planned meeting with US chief executives, including bosses at JPMorgan Chase, Blackstone, IBM, Tesla and General Motors. The CEO of Uber said Thursday he wouldn’t participate in the meeting since he opposes Trump’s executive order on refugees and immigration.
In his first order, Trump will issue a broad directive meant to garner input from the heads of federal regulatory agencies on areas for reform. The move won’t make any immediate changes to the agencies or their policies; rather, it will solicit recommendations for changes to the Dodd-Frank Wall Street reform law that was enacted in 2010.
“Everything is going to be looked at,” said a senior administration official, speaking anonymously to preview the order before it was signed.
The official conceded a complete gutting of the law would require Congress to act — “This is not an attempt to undo Dodd-Frank” — but identified areas where Trump could make unilateral changes, like placing his own directors at key regulatory bodies.
The official demurred if that meant Trump planned to fire the current head of the Consumer Financial Protection Bureau, a brainchild of Sen. Elizabeth Warren that’s expected to be on Trump’s chopping block.
Trump on Monday called Dodd-Frank as “disaster” and vowed to “do a big number on it.”
A second action Friday will direct the Department of Labor to cease implementation of an Obama administration rule on retirement investment advisers, which is supposed to take effect in April.
That measure, called the “Fiduciary Rule,” required retirement advisers to always act in their clients’ best interests. But the Trump administration official said the rule was a “complete mess” with a litany of unintended consequences.
The official said the rule was “protecting (consumers) from something they don’t need protection from,” arguing it limited options and proved expensive for asset management firms to implement.
The Labor Department will have 90 days to reevaluate the rule and report back. They’ll have the final say on whether the rule is enacted.
Both moves are expected to draw the ire of consumer protection activists, who argue even Dodd-Frank didn’t go far enough in reining in Wall Street following the financial meltdown in 2008.