Republican lawmakers in the House of Representatives and Senate have reportedly begun negotiating about repealing a section of the 2010 Dodd-Frank Ac to limit the US government’s role in supporting collapsing financial institutions.
According to a Reuters report, Republicans, who control both houses of Congress, will aim to limit the short-term loans the US Federal Reserve offers to firms desperate for cash, by amending the Title II segment of Dodd-Frank at issue that enables bailouts.
Title II provides the Federal Deposit Insurance Corp (FDIC) the access to a line of credit from the US Treasury to keep certain bank activities afloat until they can be sold off or wound down.
The bill, which is under discussion, involves changing the bankruptcy code and will take effect after going to the Senate Judiciary Committee.
A Republican aide to the Senate Banking Committee told Reuters: "We’ve been meeting every few weeks on the hope that we can produce one, comprehensive product."
Senator Jeff Merkley, an Oregon Democrat on the banking committee said: "Something that restores the difficulties that we saw in 2008 and 2009 would not be healthy."