WASHINGTON _ Donald Trump faces a major hurdle in fulfilling his pledge to do a "big number" on the Dodd-Frank Act: persuading enough Democrats to go along.
That's why Republican lawmakers say they are considering a backup plan for dismantling parts of the financial-rules overhaul that wouldn't require support from a single Democrat.
In the narrowly-divided Senate, most bills need 60 votes to become law. But Republicans are looking into ramming through changes with just 51 votes through a complicated process known as budget reconciliation.
To do that, they'd need to demonstrate that the financial regulations are draining the government's checkbook. For instance, they'd have to supply evidence federal expenditures would be reduced if hedge funds got a break on regulations. Or that the nation's fiscal health would improve if the Treasury Department doesn't help failing banks.
The strategy is already being used to go after Obamacare. Key Republicans, including House Financial Services Chairman Jeb Hensarling of Texas, have said it's also an option for targeting at least some aspects of the 2010 Dodd-Frank law.
Republicans are constrained in which parts of the law they can kill because of the need to show a direct effect on federal spending. Still, reconciliation is an "attractive option," as the prospect of Republicans and Democrats agreeing to compromise on any legislation dims, Brian Gardner, an analyst at Keefe Bruyette & Woods wrote in a note to clients Wednesday.
"It's plausible you could do this, but the next part is the hard part _ finding out what works," said Norbert Michel, a financial regulation fellow at the Heritage Foundation. "It's torturous logic to make anything fit within the limits of reconciliation."
House lawmakers, led by Hensarling, are planning to introduce legislation in the coming weeks that would make changes to Dodd-Frank, Republicans have said. Trump supports ripping up the law, saying this week that it's a "disaster" that has made it difficult for businesses to get loans and that he wants to do a "big number" on the measure. If Hensarling's bill fails to pass in the House or dies in the Senate, Republicans might then turn to reconciliation.
Here's an overview of how it works and what parts of Dodd-Frank Republicans might be able to go after.
