Treasury Secretary Neal Wolin discussed the threat of sequester, the implementation of Dodd-Frank, and the fate of the United States penny in a wide ranging interview with FOX Business Network’s (FBN) Liz Claman. Wolin said “various secretaries of the president’s Cabinet have laid out what the implications will be for their departments” if the sequester kicks in, and “it’s a very bad picture that is painted” and would be a “self-inflicted wound that we should avoid.” Neil Wolin went on to discuss the delayed implementation of Dodd-Frank saying, it is important for the regulators “to take the time to get it right” as it is a “statute that is an important addition to the safety and the stability and the resilience of our financial system.”
On whether we can expect Congress to reach a deal before the sequester deadline:
“Well, we can’t know that, Liz. I certainly hope that we can avoid the sequester because if the sequester triggers on, it will bring a lot of harm to our economy and to our national security. It is completely avoidable. And we hope, of course, that the Congress does the things necessary to avoid it. That would require a balanced approach to working through our fiscal issues. But we certainly hope that the Congress can get themselves around to doing just that.”
On the narrowing timeline to avoid the sequester:
“Well, time is getting short. There’s no question about that. The president, I think, has laid out a balanced approach. And you know, there’s real questions here about whether the U.S. should be foregoing things are important to our country and to our economy, not paying for teachers, not paying for our roads and bridges to be repaired and rebuilt; also that we can make sure that we retain a set of deductions and loopholes that the very wealthiest among us can continue to enjoy. And so that’s the fundamental choice that we have before us.”
On how the federal government is preparing for a possible sequester:
“Well, you know, Liz, there’s going to be more than 2.3 percent coming off of an awful lot of the accounts of the federal government. And the various secretaries of the president’s Cabinet have laid out what the implications will be for their departments, the amount of furloughs, the amount of services that will be foregone, the number of small business loans and so forth that won’t be made, the teachers that won’t be paid for. And, of course, the military, the Pentagon, the Joint Chiefs and so forth have made clear what the implications will be to our national security. And it’s a — it’s a very bad picture that is painted.”
On whether the spending cuts can be appropriated differently to avoid the worst implications of the sequester:
“Look, Liz, there’s no amount of flexibility or difference of appropriation adjustments that, you know, assuming Congress could get to that — which it hasn’t — that will forestall, forego the kind of economic damage and national security damage that will occur if this sequester triggers on. And what we need to do, what we need to come around to doing and what Congress ought to do is to put forward a balanced approach that avoids all that. It is not necessary for us to have to feel the economic pain and the national security pain that would be entailed. And, you know, our economy has been moving along at a upward rate. It needs to pick up that pace. So it would be a shame as if, in a needless way, Congress threw sand in those gears. That would be a self-inflicted wound that we should avoid.”
On when we can expect the Volcker rule to be finalized:
“Well, you know, we made an awful lot of progress, Liz, on Dodd-Frank implementation overall. It’s a very complicated statute, as you know. And it’s important for the regulators as they do the work of the implementation to take the time to get it right. On the Volcker rule itself, you know, there are a number of agencies that are working on this; five of them in all. And you know, they’ve spoken to what they expect the timing to be. I expect it will be, you know, sooner than later. But, again, I think the key point is to make sure that the details of the Volcker rule are done thoughtfully and they’re done right, and they reflect all the input that these agencies have gotten from the public and from stakeholders about what the contours of that rule ought to be.”
On whether Volcker rule takes on too much:
“I don’t think so. You know, people complain when they don’t have a
