Democratic presidential candidates Bernie Sanders and Hillary Clinton have been taking jabs at one another about who would do a better job of holding financial services firms and their employees responsible for misconduct. Whether the virtual tie in last week’s Iowa caucuses or the Sanders victory in this week’s New Hampshire primaries was impacted by this issue is, of course, unclear. At the end of the day, however, it may not matter which candidate wins the party’s nomination, even if he or she ultimately wins the general election in November. Like most issues, the extent to which regulators will be able to expand their oversight of Wall Street will depend primarily on the budget.

This week, President Barack Obama requested that Congress double the budgets of the Securities and Exchange Commission and the Commodity Futures Trading Commission over the next several years. That request is certain to encounter opposition from the Republican-controlled legislature, not least because he will remain in office less than a year. Assuming that Republicans continue to control Congress after the general election, as most political pundits predict, it is doubtful that significantly higher appropriations for the SEC and the CFTC will find their way into the budget for the fiscal year beginning October 1, or subsequent years.

The President’s request called for an increase in funding of the SEC from US$1.6 billion to US$1.8 billion in the next fiscal year, and an increase in the budget for the CFTC from US$250 million to US$330 million. The Administration also requested that those amounts increase to US$3 billion and US$500 million for the SEC and CFTC, respectively, by the fiscal year beginning October 1, 2020.

SEC officials continue to claim that its budget is self-funded by fees and fines levied on the firms it oversees and, therefore, does not impact the federal deficit. Presumably, the CFTC staff would make the same claim. This argument is also unlikely to persuade Congress to approve the increased budget requested by the President. The two agencies continue to state that they lack sufficient funding to enforce rules regulating the securities and derivative markets, or to fully implement all of the requirements mandated by the 2010 Dodd-Frank Act.

So it is likely that the agencies will need to pick and choose how best to deploy their limited resources. For example, the SEC has signaled that it will shift many Office of Compliance Inspections and Examinations staff members from broker-dealer exams to investment adviser exams. OCIE director Marc Wyatt is expected to officially announce that it plans to shift approximately 100 examiners from BD to IA exams. Even this may not be enough to address the adviser exam shortfall, however. Industry observers, including former SEC Chairman Harvey Pitt, believe that there will never be enough examiners, or the financial resources to pay them, and therefore has advocated a third-party audit concept. Presumably, industry members themselves would then be required to absorb such audit costs.

Despite President Obama’s request, it is likely that budget limitations will continue to constrain the regulatory and enforcement capacities of the SEC and CFTC for the foreseeable future. This, in turn, will require those agencies to be selective about how they deploy their resources. It is unlikely that they will have the funding to increase comprehensively the oversight of the financial services industry.