"The House Appropriations Committee's fiscal 2013 spending package would slash the Commodity Futures Trading Commission's annual budget by about $25 million to $180.4 million," reducing the government's budget for the derivatives watchdog charged with policing oil trading, financial derivatives and other sensitive and risky bets by JPMorgan and other big banks, writes Reuters here.
"The Securities and Exchange Commission, meanwhile, would see its 2013 budget rise by about $50 million, to $1.37 billion from $1.32 billion," but limit the use of that additional money to computer systems, "according to the Republicans' proposal." President Obama's budget calls for more.
Congress is ambivalent about financial regulation:
- Past Democratic bills would break up big banks and limit their trading activities, in an effort to reduce the danger bank executives and their Wall Street traders will keep collecting millions of dollars a year while relying on taxpayer guarantees and bailouts when their bets go bad.
- But Republicans blame regulators for stunting investment growth by scaring capitalists into taking fewer risks and spending too much on lawyers and accountants.
- Members of both parties have cooperated with Wall Street lobbyists and donors by rolling back restrictions on both public and private companies this election year.
Said CFTC Chairman Gary Gensler of the GOP proposal: "The result of the House bill is to effectively put the interests of Wall Street ahead of those of the American public by significantly underfunding the agency Congress tasked to oversee derivatives - the same complex financial instruments that helped contribute to the most significant economic downturn since the Great Depression."