Republican lawmakers in the U.S. House of Representatives and Senate are discussing a joint effort to repeal a key section of the landmark Wall Street reform law, seeking to limit the U.S. government's role in supporting financial institutions on the brink of collapse, Reuters reported yesterday. Efforts by Republicans to revamp the 2010 Dodd-Frank Act, including its handling of failing banks, went nowhere in the past because the Democrat-controlled Senate defended the law. A new push on the bank resolution issue would still face major hurdles, including a likely veto from President Barack Obama, who has vowed to protect the law, and opposition from the banking sector itself. But this year, Republicans control both houses of Congress, and they hope to reduce the law's reach and rein in the Federal Reserve and other powerful regulators. Some lawmakers who have pushed for changes in how failed banks are administered, including Senator Pat Toomey of Pennsylvania, have bigger leadership roles. "We've been meeting every few weeks on the hope that we can produce one, comprehensive product," a Republican aide to the Senate Banking Committee told Reuters, adding that talks involved staff members in the House and Senate. The segment of Dodd-Frank at issue is called Title II or the orderly liquidation authority. It allows U.S. regulators to intervene to manage the collapse of a systemically risky bank, insurer or other major financial company to avoid a messy failure that spreads risk to the broader financial system. Republicans say this process would enable bailouts. They are aiming to repeal that provision, limit the short-term loans the U.S. Federal Reserve offers to firms desperate for cash, and make bankruptcy the only option for failing banks.
