Trump Administration Cuts Financial Regulation and Agency Staffing

The administration of Donald Trump has launched a comprehensive deregulatory campaign targeting the U.S. financial system. The strategy centers on Executive Order 14215, which places independent regulators under White House control, and a significant reduction in capital requirements for systemically important banks. Federal agencies have finalized a rule that lowers leverage capital requirements for large banks by nearly 30%.

To support these goals, the administration is drastically reducing staffing across federal financial agencies. The Federal Reserve has already cut its workforce by 10% and plans to reduce its supervision division by 30% by 2026. The Federal Deposit Insurance Corporation and the Securities and Exchange Commission have implemented or planned staffing reductions of 20% to 30%, while the Consumer Financial Protection Bureau faces a proposed workforce cut of nearly 90%.

The United States Department of the Treasury has defended these moves, arguing that financial regulation itself can threaten financial stability. However, former FDIC Chairman Martin Gruenberg warns that these measures hollow out institutional memory and weaken the safeguards necessary to prevent a systemic collapse, suggesting the campaign could precipitate a new financial crisis.