WASHINGTON — Although the Financial Crisis Inquiry Commission is primarily concerned with past events that caused the housing collapse, members of the panel challenged two top regulators Thursday over whether the recently enacted regulatory reform law had eliminated the possibility of future government bailouts.

At a hearing on "too big to fail" institutions, commissioners questioned if the new systemic risk council would have the political will to break up risky firms, raised concerns about "living wills," and wondered whether regulators will eventually be forced to provide assistance to large troubled companies.

"Why should we believe that this Council is going to be uniquely different and keep us out of trouble?" asked John Thompson, a commissioner on the panel.

Although they testified separately, both Federal Reserve Board Chairman Ben Bernanke and Federal Deposit Insurance Corp. Chairman Sheila Bair had the same message: the days of bailouts are officially over.

Bair insisted that the Financial Stability Oversight Council, which was formed by the Dodd-Frank law enacted July 21, will be held accountable.

"If there is a systemic crisis, we can't go and say, 'Well the Fed had the bank holding companies, the OCC had national banks, and SEC had the investment banks,' we are all put together in the same room," she said. "It's our job to manage systemic risk and make sure there are no regulatory gaps. We have accountability. We have ownership. If we don't do our job, we should be held strongly accountable."

But it was clear not everyone was convinced. Douglas Holtz-Eakin, a former economic advisor to Sen. John McCain's 2008 presidential campaign, suggested the administration already had access to systemic council of sorts.

"Isn't the new stability council just the President's Working Group with a coat of paint?" he said, referring to the now defunct informal group of regulators formed after the stock market crash of 1987.

But Bair insisted it was different, saying it has "specific responsibilities with specific timetables for jobs."

"I think it will be a more robust, comprehensive effort," she said.

Both Bair and Bernanke highlighted some of the council's powers, including the ability to break up an institution if it is deemed systemically risky. Regulators also can order the divestiture of an institution that does not submit an adequate living will, essentially a guide for how to break up an institution.

Under the law, the council is tasked with setting higher capital, liquidity and leverage standards and recommending ways to ensure proper management of systemically important companies.

But commissioners questioned whether regulators would really have the guts to, for example, break up a company — and if other policymakers would support them if they did.

"Do you believe there is the political support both in the executive branch and in the Congress to implement these available powers to begin the process of restraining the growth of these large institutions?" asked former Sen. Robert Graham, a member of the panel.

Bernanke acknowledged that without a willingness to follow through, the prospect of avoiding another crisis was bleak. "If there's a lack of political will, there's probably no solution that is sustainable," he said.

But he said regulators will try to follow through.

"We have both the living will requirement, but in addition we also have the authority — the regulators, collectively — to break up firms, if necessary," he said. "You may ask if there's political will to do that, and I don't know the answer to that question. But certainly, that's the charge that Congress has given the regulators and we take very seriously that charge."

Bair said regulators have to act if they want to guard against future crisis.

"Regulators must have the courage to act on the Council's recommendations if we are to address systemic risk before they result in damage to our economy," said Bair. "We're certainly forging ahead and I think everybody else is just as committed."

Asked whether large, complex firms should be broken up, Bernanke reiterated that size itself was not the problem, but whether a firm had the ability to properly manage the institution.

"It's our responsibility to make sure their management is effective," he said. "If we are persuaded that they cannot manage the risks of the organization because it is too complex, we have the ability to change their structure."

He said regulators would take action in such a scenario.

"Where there is a failure of risk management or business management because of business complexity, it's very important regulators work to address the problem, and I assure you that we will," he said.

While rules for developing living wills are not due until 18 months after the enactment of the law, Bair said she is hoping to get the rule out much earlier. She has also set a target of setting up a general framework for resolution authority in the interim and providing a detailed plan within the next several months.

"Markets in the United States are very resilient, and I think if they understand what the rules are, they will be able to live with the rules," said Bair.

Commissioners pressed regulators on whether the financial crisis would have gone differently had Dodd-Frank already been in place.

"What would be different now?" asked Holtz-Eakin. "How would it play out for Bear [Stearns], Lehman, AIG, if those authorities were in place?"

Bernanke said all three would have been seized and unwound by the government.

"In all three cases, they would have been appropriate candidates for use of the resolution authority," Bernanke said. "I don't know what the alternative would have been unless we could have stopped the [liquidity] runs with cheery words. But I don't know how to do that."

Bair said the FDIC would have had a detailed resolution plan for Wachovia Corp. before it needed a government intervention in September 2008.

"We would have had better information about its structure and risk profile," Bair said. "And we would have faced fewer impediments to effecting its orderly resolution. In short, Wachovia, or Lehman for that matter, could have been resolved without a bailout and without disrupting financial markets."

Both said that the government will no longer bail out financial firms.

"Changes in the bill have eliminated the ability of the Fed to lend to an individual institution," Bernanke said. "Barring some midnight session of Congress that rewrites the law, I don't think it would be feasible for us to bail out firms the way we did during the crisis."

Bair agreed that "bailouts are just not acceptable going forward."

"We pushed for this line," she said. "The statute specifically prohibits any kind of open institution assistance. So if it happens, it's going to have to be Congress doing it. The regulators have no authority to do bailouts anymore, and that's a good thing."