The Dodd-Frank Act will reduce the U.S. budget deficit by $3.2 billion over a 10-year period by taking in more money than will be spent on implementation and enforcement, the Congressional Budget Office said.
Dodd-Frank, the regulatory overhaul signed into law by President Barack Obama, will require $10.2 billion in direct spending, while taking in $13.4 billion over the next decade, CBO Director Douglas W. Elmendorf said today in testimony prepared for a House Financial Services subcommittee hearing.
Federal regulators are writing and implementing hundreds of measures approved by a Democrat-led Congress in response to the worst financial crisis since the Great Depression. The new rules will dictate how large financial firms including Goldman Sachs Group Inc. (GS), JPMorgan Chase & Co. (JPM) and American International Group Inc. (AIG) are able to do business in the future and how much they’ll have to pay to do it.
“The revenues would stem primarily from fees assessed on various financial institutions and market participants,” Elmendorf said.
House Republicans, who almost unanimously opposed the bill last year, are investigating Dodd-Frank’s costs and its effect on economic growth. Representative Randy Neugebauer, a Texas Republican who leads the Financial Services investigations subcommittee, is holding hearings on legislation, which the Government Accountability Office said may cost more than $1 billion for U.S. agencies for initial implementation.
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