No stranger to tall tasks, Tim Geithner has lined up another one.
The Treasury secretary will promise Monday he'll press federal bureaucrats to swiftly translate a sprawling 2,300-page regulatory reform bill into clear new financial rules.
Geithner (right) is scheduled to speak Monday afternoon at New York University on what will happen next on the financial regulatory front. Speech excerpts released by Treasury show Geithner trying to calm anxiety over a process that is already a year old and promises to consume at least another year.
"We will move as quickly as possible to bring clarity to the new rules of finance,” Geithner will say in the speech, scheduled for 4 p.m. EDT. “The rule writing process traditionally has moved at a frustrating, glacial pace. We must change that."
The remarks come amid signs that the economic rebound that started last year is starting to lose steam. Complicating matters, Wall Street expects the task of actually writing the rules passed last month under the Dodd-Frank Act to take 12 to 15 months – which observers fear will only exacerbate the current muddle, in which cash-rich companies aren't hiring and entrepreneurs aren't starting new businesses.
“Unclear policies and undefined regulations create uncertainty and instability that bollix long-term planning,” Dallas Fed President Richard Fisher said in a speech last week. “Those responsible for enforcement of recently passed reforms need to focus with laser-like intensity on addressing the regulatory indigestion that has engulfed our economy.”
Yet effort alone won’t get the new rules written faster. Scores of lobbyists are descending on Washington to push the views of their deep-pocketed backers. Loath to overhaul the system without weighing all views, officials are promising to solicit public comments as well.
And that’s just for the new rules. Geithner promises to take an axe to outmoded regulations too, while he's at it.
We will not simply layer new rules on top of old, outdated ones. Everyone that is part of the financial system - the regulated and regulator - knows that we have accumulated layers of rules that can be overwhelming. So alongside our efforts to strengthen and improve protections for the economy, we will eliminate rules that did not work. Wherever possible, we will streamline and simplify.
The end result, he promises, won’t wrap everyone in endless red tape. “The reforms that are now the law of the land will help us rebuild a pro-growth, pro-investment financial system," he will say. Godspeed to him on that.