House Minority Leader John Boehner (OH) has made some headlines over the past month about somehow stopping regulations from being issued next year. Boehner originally suggested a complete moratorium. He recently modified that to suggest something more limited.
The proposed moratorium was obviously an appeal to the financial community. The vast majority of regulations required by the Dodd-Frank Wall Street reform bill are supposed to be in place by close to the end of 2011 so the most immediate effect of stopping the regulatory process would be to put that law on hold.
But the real question is whether there’s any way for Boehner to make his plan happen. The answer is no: The Dodd-Frank and other regulations are far more likely to move ahead than to be stopped.
Regulatory requirements like those in Dodd-Frank are included in the law and, therefore, are statutorily required. Even if there is a Republican takeover of the House and Senate this November, the mandate imposed on federal agencies and departments to promulgate the regs will still be in effect. Agencies and departments that ignored the mandate could be subject to legal action and would get a great deal of counter pressure from the White House. Some would be subject to dismissal by the president.
The statutory requirement could, of course, be changed if other legislation amending existing law were passed by both houses and signed by the president. But a veto would also be likely and. unless something that is currently very unexpected happens this November, the votes to override that almost certain veto likely won’t exist. As a result, the original mandate would stand and the regulations would be issued.
The most interesting scenario would be if, instead of amending Dodd-Frank, a GOP-majority Congress included language in appropriations bills that prohibited an agency or department from spending any funds to develop the regulations they are required to promulgate by Dodd-Frank. The president may veto an appropriation, but that could lead to a partial or full shutdown a stalemate developed between the White House and Congress over this issue and no funds were provided. As Republicans learned in 1995 and 1996 when the last shutdowns occurred, that would be a huge political risk.
There are important limits to the appropriations strategy, especially when it comes to Dodd-Frank. Most of the regulatory requirements in that law are imposed on independent federal agencies like the Securities and Exchange Commission, the Federal Deposit Insurance Corporation, and the Federal Reserve and they don’t rely on appropriations for funding. There’s almost no way to get to them through appropriations, therefore.