WASHINGTON Feb 12 Republicans in the U.S. House
of Representatives are gearing up to overhaul the housing
finance system this year and will soon map out ways to monitor
Wall Street reform rules, according to a draft agenda
circulating on Capitol Hill.
Republicans on the House Financial Services Committee, the
panel that oversees Wall Street and financial regulators, will
aim to review how the 2010 Dodd-Frank reform law is being
implemented, its top Republican said in a document obtained by
The legislative debate on the Dodd-Frank financial oversight
law was heated and partisan as the Obama administration wrangled
for stricter regulations for banks, hedge funds, derivatives
traders and other financial market players.
Dodd-Frank has since remained a target for Republicans who
have tried to repeal or scale back numerous measures, with
limited success. Republicans have also tried to restrain
regulators by denying big boosts to their budgets, despite extra
"The Committee will seek to ensure that regulators carefully
and transparently assess the costs and benefits of regulations
called for by the Dodd-Frank Act in order to strike an
appropriate balance between prudent regulation and economic
growth," Representative Jeb Hensarling, the committee's
chairman, said in the document.
He said one of the "primary tasks" of the committee would
include monitoring how regulators work to avoid systemic risk
and contagion while simultaneously implementing rules that
prevent larger financial institutions from receiving an unfair
edge over smaller lenders.
The panel is scheduled to vote on the agenda no later than
Feb. 15. The agenda was first reported by Bloomberg News.
Hensarling said Republicans also want to examine possible
changes to the housing finance system, which is almost entirely
backed by the government.
Democrats on the committee, including ranking member Maxine
Waters, are expected to resist Republican efforts to chip away
at Dodd-Frank and will to defend the need for a strong
government role in the mortgage market.
The committee has already started to scrutinize the
financial health of the Federal Housing Administration, the
government's mortgage insurer, with a series of hearings that
kicked off last week.
Hensarling said the committee will look at the structure of
mortgage giants Fannie Mae and Freddie Mac,
the two companies seized by the government in 2008 amid fears
they might collapse under real estate debts. The bailout has
cost taxpayers nearly $190 billion.
Steps that may be proposed to level the playing field
between the publicly backed mortgage sector and the private
market, which has been flat on its back for years, include
scaling back the huge loan portfolios of Fannie and Freddie.
"The Committee will examine proposals to modify or terminate
Fannie Mae's and Freddie Mac's statutory charters, harmonize
their business operations, and wind down any legacy business
commitments," the draft said.
House Republicans want to examine the overall size of the
government's role in various aspects of the housing finance
system and may seek to find ways to "reduce or constrain" the
market share of Fannie Mae and Freddie Mac, or wind the two
The 21-page document included an outline of a housing
finance system in which lawmakers develop what it described as
"a vibrant, innovative and competitive private mortgage market."
Republicans will also seek to review the new authority
regulators have over the multitrillion-dollar over-the-counter
derivatives market, according to the document.
In addition, it said the committee may attempt to ensure the
Volcker rule on proprietary trading and investments "does not
result in unintended consequences for U.S. economic
competitiveness and job creation, depress the value of pension
plans and retirement accounts, or drain substantial amounts of
liquidity from the U.S. capital markets."
Other priorities include taking a look at the authority of
the Financial Stability Oversight Council, credit rating
agencies and the structure of the Consumer Financial Protection