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Treasury hits back at Dodd Frank repeal

Monday 4 April 2011 - by Will Henley

The US Treasury has hit back at Republican critics of the Dodd Frank Act, saying that the party is trying to drag the country back to a "broken system".

The claim comes as the opposition party steps up efforts this week to force Obama to accept a $4tn (€2.8tn) reduction in the 2012 federal budget.

Steve Adamske, deputy assistant secretary for public affairs, suggested on Friday that draft legislation introduced the same day to repeal the 848-page Dodd Frank package endangers financial stability.

"Their bold proposal is simply to do away with it and, instead, revert back to a system that brought our nation to the brink of complete financial meltdown," Adamske wrote in a blog post on the Department website on Friday.

"Maybe these legislators have forgotten, but just a few years ago, the United States went through the most significant financial crisis since the Great Depression. Thousands of American businesses collapsed.

"Millions of jobs were lost. Trillions of dollars in household wealth and retirement savings were swept away. Our nation's economy was brought to its knees."

The Republican's draft S. 712 Financial Takeover Repeal Act, which would repeal the Dodd-Frank Act, was introduced on Friday with eighteen congressional co-sponsors.

Senator Jim DeMint, who introduced the bill, aims to ramp up the pressure on the Obama administration with the legislative attempt.

Suggestions are that the upcoming Republican budget cut plan, spearheaded by House Budget Committee chairman Paul Ryan, could include a tax cut for corporation and individuals from 35 to 25 per cent.

It could also allow companies to return overseas profits to the US at a greatly reduced rate, according to reports. However, like the Dodd Frank repeal attempt, the plans are likely to be stymied by the Democrat controlled Senate.

The latest legislative moves come after House Republicans last week unveiled eight separate bills involving measures to overhaul beleaguered mortgage giants Fannie Mae and Freddie Mac.

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