President Barack Obama's plan to transform the Federal Reserve into a super-regulator ran into skepticism Today from lawmakers who worry that the central bank is not the best choice for the job, AP reported. The aim is to appoint a regulator to watch over U.S. financial firms deemed so big and influential that their demise could hurt the economy. Members of Congress voiced misgivings as Treasury Secretary Timothy Geithner began a marathon day of selling Obama's financial regulatory plan to give the Fed more authority, create a new consumer protection agency and bring unregulated sectors of the financial markets under government oversight. «I do not believe that we can reasonably expect the Fed or any other agency to effectively play so many roles,» said Sen. Richard Shelby, an Alabama Republican. He noted that the Fed also sets monetary policy, regulates banks and handles an array of other functions. Some lawmakers have proposed that the job of overseeing large institutions be left to a council of regulators, not a single agency. Geithner anticipated that point in his testimony before the Senate Banking Committee, saying in his opening remarks: «You cannot convene a committee to put out a fire.» Committee Chairman Christopher Dodd, a Democrat from Connecticut, also raised questions about the use of the Fed for such an overarching task over the financial system. But he applauded the administration for including a new agency to protect consumers in their banking transactions. Dodd said regulators must be empowered and that gaps in oversight should be eliminated. Financial institutions that pose a threat to the economy shouldn't go unchecked, he said, and there should be more transparency in certain markets.
