Dodd-Frank will cost almost $3 billion, states Government Accountability Office

What will the cost of customer financial reform under the Dodd-Frank Wall Street Reform Act be? With any governmental undertaking, there’s a financial burden working class individuals shoulder. In accordance with a Government Accountability Office (GAO) report, that burden will amount to as much as $2.9 billion over five years, the price of Wall Street reform.

Working class individuals don’t always determine financial stability

Taxpayers feel like they’re getting money taken left and right. The Wall Street Journal reports the Dodd-Frank Act will be able to function without taxpayer subsidization. There are 11 agencies that are there to enforce the Dodd-Frank law. Six of them are already funded for probably the most part. Congressional appropriations cover three others while the Federal reserve will give money to the Consumer Financial Protection Bureau which money comes, not from taxpayers, however from revenues for instance assessments.

Paying out to the government from banks

Banks, credit unions, investment houses and short term installment loan outlets are slated to pay the U.S. government more to operate under Dodd-Frank laws. This has elevated concerns within the financial community that competitiveness will be hampered by over-regulation, and House Republicans have taken up that torch, using GAO report findings to support the idea that Dodd-Frank is too much for a slowly recovering economy to bear.

The GOP will be talking about the first year of the Dodd-Frank Wall Street Reform Act as it will cost about $975 million to support all 11 agencies. The five year tag is closer to $2.9 billion. Moreover, hiring 2,600 full-time workers (including 1,225 for the Consumer Financial Protection Bureau) will produce significant cost.

GAO report shows even more

The Journal explains that these things were noted in the GOP presentation to the House Financial services Subcommittee on Oversight and Investigations:

• A Fed estimate from earlier this year projected a cost of $77.5 million to pay 290 full-time staff dedicate to Dodd-Frank implementation. The Financial Market Infrastructures Oversight, the Office of Financial stability Policy and Research and the Financial Market Infrastructures Risk Analytics have all been offices created. These three offices are necessary if the Dodd-Frank laws are to run correctly.
• The Financial stability Oversight council will, starting in the fiscal year for 2012, have to pay $7.9 million for a full time staff of seven.
• About $74.5 million will be used to pay the 135 full time staff for the Office of Financial Research in the fiscal 2010. These employees are there to make sure the Dodd-Frank duties are done.

Information from

Senate

banking.senate.gov/public/_files/070110_Dodd_Frank_Wall_Street_Reform_comprehensive_summary_Final.pdf

Government Accountability Office

gao.gov/

Wall Street Journal

blogs.wsj.com/washwire/2011/03/28/dodd-frank-2-9-billion-over-5-years-gao-says/

GOP on what Dodd-Frank might cost small businesses

youtube.com/watch?v=6iB2fWk7Rho