The Obama Administration uncorked its regulatory reform platform last week, and there was no shortage of either critics or champions of the package. Only one regulatory agency would be eliminated—the Office of Thrift Supervision—while the Securities Exchange Commission, the Commodities Futures Trading Commission, and other regulatory fiefdoms beloved by various Congressional committees would remain unscathed. The Federal Reserve is the designated systemic-risk czar under the plan, and has influence throughout the Byzantine warrens of examiners, inspectors, and reviewers, but the Fed loses its consumer protection powers to the newly invented Consumer Financial Protection Agency. There would also be a new Financial Services Oversight Council chaired by the Treasury secretary, designed to advise the Fed, make recommendations, gather information from financial institutions, and deliver annual reports to Congress. The council chair presumably would also break up hall fights between member regulators.

President Barack Obama soon made clear his priority in the 85-page regulatory retooling. He devoted prime real estate to the Consumer Financial Protection Agency in his weekly address on June 20. “It is charged, with just one job: looking out for the interests of ordinary Americans in the financial system,” he said. “It will have the power to set tough new rules so that companies compete by offering innovative products that consumers actually want—and actually understand.”

To get his regs redo done, Obama is running against Washington: “But what I will not accept—and what I will vigorously oppose—are those who do not argue in good faith. Those who would defend the status quo at any cost.” He warned in his remarks June 21 that he sees those lobbyists “mobilizing against change.”

Some critics contend that the proposal is tilted toward the status quo. The program contains “virtually all sensible, necessary reforms,” writes Brookings Institution fellow Douglas J. Elliott in a review of the proposal. “Unfortunately, some bolder steps have been left out, apparently due to the expectation of intense opposition from entrenched interests.” Elliott is most disappointed with the lack of ”consolidation of regulatory functions into fewer hands.”

CreditSights expressed general support for the Obama plan, but is “skeptical [that] the meat of these changes will make it through Congress intact,” according to a research note issued last week. The firm supports a “public-private partnership that would include both regulatory agencies and private sector participants to vet and oversee the banking system,” an element missing from the administration’s proposed overhaul.

Harvey Rowen, chief executive officer of Starmont Asset Management, says the White House effort is “a good beginning — clearly we had a breakdown of regulation.” The government’s response to last fall’s crisis was too ad hoc in nature, according to Rowen, a former president and CEO of Merrill Lynch Bank & Trust who also headed Charles Schwab & Co.’s retirement plan services division. “Bear Stearns, Lehman Brothers, AIG—people were meeting until two or three in the morning, without any roadmap,” says Rowen. The Obama proposal “is a major step, something that’s better than what we have now, which is nothing.”

He expects “a lot of rule-making to come out of this, things that could have and should have been addressed but weren’t.” The Consumer Financial Protection Agency “will pass—it does a pretty good job—although a lot of pushing and shoving will go on,” Rowen predicts.

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