(Update: This article is now updated with the full text of President Trump's executive order.)
As expected, President Donald Trump signed an executive order on Friday that begins to roll back the Dodd-Frank Wall Street Reform Act, the landmark legislation passed in wake of the financial crisis.
Word of Trump’s plans for signing the executive order first began to leak out Friday morning, with Trump himself saying that his administration plans to “cut a lot of out of Dodd-Frank.”
Trump signed the order with Gary Cohn, the White House National Economic Council Director and a former top executive at Goldman Sachs, and House Financial Services Committee Chairman Rep. Jeb Hensarling, R-Texas, by his side.
“We’re signing new rules for regulating the U.S. financial system. It doesn’t get much bigger than that, right?,” Trump said just before signing the executive order.
The details of the executive order are not yet public, but early indications were that the order directs the Secretary of the Department of the Treasury to begin reviewing Dodd-Frank and its associated laws.
Hensarling put out a statement about Trump’s action on Friday, saying that much of the order “mirrors” the Financial CHOICE Act, the Republican-led effort to repeal and replace Dodd-Frank.
“I’m very pleased that President Trump signed this executive action, which closely mirrors provisions that are found in the Financial CHOICE Act to end Wall Street bailouts, end ‘too big to fail,’ and end top-down regulations that make it harder for our economy to grow and for hardworking Americans to achieve financial independence,” Hensarling said.
“When Dodd-Frank was passed, Americans were promised a healthier economy, an end to bailouts and better consumer protections. Instead, we have the weakest recovery in history, a guarantee of more Wall Street bailouts, and consumer costs have gone up while their choices have gone down. Today the big banks are bigger and the small banks are fewer. Everything from mortgages to credit cards to monthly checking fees costs more because of Dodd-Frank’s red tape, if consumers can even get access to them,” Hensarling continued.
“Dodd-Frank failed to keep its promises, but President Trump is following through on his promise to the American people to dismantle Dodd-Frank,” Hensarling concluded. “That’s not what Wall Street wants, but it is what hardworking Americans need to have a healthy economy with more opportunities so they can achieve financial independence. Republicans are eager to work with the President to end and replace the Dodd-Frank mistake with legislation that holds Wall Street and Washington accountable, ends taxpayer-funded bailouts forever, and unleashes America’s economic potential.”
On Friday afternoon, the White House released the text of the executive order.
Here it is in full:
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CORE PRINCIPLES FOR REGULATING
THE UNITED STATES FINANCIAL SYSTEM
By the power vested in me as President by the Constitution and the laws of the United States of America, it is hereby ordered as follows:
Section 1. Policy. It shall be the policy of my Administration to regulate the United States financial system in a manner consistent with the following principles of regulation, which shall be known as the Core Principles:
(a) empower Americans to make independent financial decisions and informed choices in the marketplace, save for retirement, and build individual wealth;
(b) prevent taxpayer-funded bailouts;
(c) foster economic growth and vibrant financial markets through more rigorous regulatory impact analysis that addresses systemic risk and market failures, such as moral hazard and information asymmetry;
(d) enable American companies to be competitive with foreign firms in domestic and foreign markets;
(e) advance American interests in international financial regulatory negotiations and meetings;
(g) restore public accountability within Federal financial regulatory agencies and rationalize the Federal financial regulatory framework.
Sec. 2. Directive to the Secretary of the Treasury. The Secretary of the Treasury shall consult with the heads of the member agencies of the Financial Stability Oversight Council and shall report to the President within 120 days of the date of this order (and periodically thereafter) on the extent to which existing laws, treaties, regulations, guidance, reporting and recordkeeping requirements, and other Government policies promote the Core Principles and what actions have been taken, and are currently being taken, to promote and support the Core Principles. That report, and all subsequent reports, shall identify any laws, treaties, regulations, guidance, reporting and recordkeeping requirements, and other Government policies that inhibit Federal regulation of the United States financial system in a manner consistent with the Core Principles.
Sec. 3. General Provisions. (a) Nothing in this order shall be construed to impair or otherwise affect:
(i) the authority granted by law to an executive department or agency, or the head thereof; or
(ii) the functions of the Director of the Office of Management and Budget relating to budgetary, administrative, or legislative proposals.
(b) This order shall be implemented consistent with applicable law and subject to the availability of appropriations.
(c) This order is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person.
DONALD J. TRUMP
THE WHITE HOUSE,
February 3, 2017.