President Obama greets Treasury Secretary Timothy Geithner after the… (Saul Loeb / Pool/Getty Images )
Reporting from Washington — Treasury Secretary Timothy F. Geithner has a message for voters as they listen to Republican presidential candidates call for repeal of the 2010 Dodd-Frank financial overhaul law: Remember the pain.
"I would say remember 2008 and 2009," Geithner told reporters during a news conference touting the benefits of the overhaul.
"Remember the fact that the reason why we're living with very high unemployment with millions of Americans that have lost their homes, terrible damage to the basic economics of America is because of the failures that caused this crisis in the financial system," he said.
"And if you want to go back to that," he said, "if you want to choose that future, then you should be in favor of the repeal of the law."
Republican presidential candidates have hammered away at the sweeping rewrite of financial regulations.
At a debate in Florida last month, GOP front-runner Mitt Romney said the law was "just killing the residential home market and it's got to be replaced.''
Newt Gingrich was more blunt. Asked what could be done to help struggling homeowners, he said, "I think, first of all, if you could repeal Dodd-Frank tomorrow morning, you would see the economy start to improve overnight."
In the face of such criticism on the campaign trail and from Republicans in Congress, Geithner defended the law.
He said Thursday it already had helped the financial system become "stronger and safer" even as some key provisions, such as the Volcker Rule restriction on banks trading with their own money, were still being implemented by regulators.
Speaking as the head of the Financial Stability Oversight Council — a panel of regulators created by the law to monitor the financial system for signs of problems — Geithner said the law had helped the economy recover.
Regulators this year will designate the large financial firms, outside the banking system, that will receive tougher oversight because their failure would pose a risk to the financial system, he said.
And the Obama administration will release more details about its plans to overhaul the housing finance system and replace mortgage giants Fannie Mae and Freddie Mac, which the government seized in 2008.
Republicans and business groups have criticized the hundreds of regulations required by the new law and tough new oversight, including the creation of the Consumer Financial Protection Bureau.
They have said that the uncertainty about pending regulations has made businesses hesitant to hire, and that tough new rules on banks, such as requiring them to hold more reserves, was limiting the banks' ability to make loans to boost the recovery.
But Geithner said the new rules were badly needed to prevent a repeat of the crisis, and he criticized opponents who were trying to drag out implementation of the Volcker Rule and other provisions. Slowing those changes, he said, would increase uncertainty.
"No financial system is invulnerable to crisis," Geithner said. "We have a lot of challenges ahead. We still have a lot of unfinished business on the path of reform.
"But the American financial system now is much less vulnerable than it was and is now able to help finance a growing economy, rather than being a drag on overall economic growth."