The Future of the Consumer Financial Protection Bureau
http://thedianerehmshow.org/shows/2011-05-05/future-consumer-financial-protection-bureau
The Consumer Financial Protection Bureau has been under assault almost from the moment it was put on the drawing board. The battle lines are familiar. Democrats versus Republicans. Yesterday a GOP-led House subcommittee approved three bills that would change the agency's structure. Republican critics said the measures would improve the CFPB, partly by making it more transparent. CFPB supporters blasted the bills as an attempt to cripple the bureau, which the banking industry has lobbied hard against. The continuing fight over the new watchdog of banks, credit card companies, the mortgage industry and other consumer lenders.
Guests
Travis Plunkett
legislative director, the Consumer Federation of America.
Maya Jackson Randall
financial reporter, Dow Jones Newswires, Wall Street Journal bureau.
Mark Calabria
director of financial regulation studies, Cato Institute.
Comments
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Great another redundant government bureaucracy, just what we need. Obama the smartest guy in the room! maybe in his own mind and to the sycophants that lick his feet.
Monte, How sad that you cannot be objective and non-judgemental. I pray that your final judge does not use the same criterion.
The dignity of man demands an unwavering level of human rights. Anything less will be included in your final judgement. Please find a religion that preaches dignity and human rights.
No judgment calls in politics? OK, it would be hard to cast a vote though.
"Consumer Financial Protection Bureau" we need this to help people understand a loan contract, not be charged when they exceed their credit limits when they buy a cup of coffee, not be charged late fees when they make their credit card payments on the day before it's due and on and on. Sorry you just cannot help people like this without punishing the responsible. In other words the responsible will just pay for stupidity of others who just will not change their ways and this nonsense will only make matters worse and cost the economy more jobs. This is just another form of wealth redistribution.
Again another fascist guest from the CATO Inst faux thinktank, and NPR has the gule to ask the public for funding?
Well screw that!
Whenever I see people objecting to laws like the consumer financial protection act I know that they have been blessed never to have been around the elderly or poor who are preyed upon by the most unethical of marketers. I have known older people who kept buying useless merchandise believing that hte next purchase (and the next purchase) would win them a Cadillac. This law is too little, too late for them, but just might help thousands and thousands of people from being defrauded of their often meager means of survival.
If you don't believe advantage is taken of the average person, all you need to do is see what happened in Indiana a couple of years ago. The ordinary taxpayers were conned into believing that they would be better off by cutting the real estate taxes of those of us fortunate enough to own some and increasing the sales tax that they pay. In addition the limit on ttaxes for rental property is double that of home owners. How many ways can you say Sucker!!
Can we please dispense with the fiction that the Republicans are trying to help the CPFB? Even Mr. Calabria admitted he would like to see the agency killed. Just be honest about it. Any constraints they are trying to place are ones which would prevent the agency from doing its job: protecting consumers.
The only people profiting from the current economic crisis were the individuals, banks, and corporations who created the crisis. The consumer has been left without any real protection until this Consumer Financial Protection Bureau was created and now the Republicans want to destroy it through these bills.
Elizabeth Warren was one of the first people to sound the alarm about the economic fragility of the average American. She is a strong advocate for the average person not the big banks, corporations, politicians, and the most powerful Americans. She is a dangerous woman to them and they want to eliminate any of her power.
I'm sick and tired of listening to people from The Cato Institute and other powerful conservative politicians who act like protectors of the little guy while enacting laws and policies that pad the pockets of the banks, corporate leadership, and the top 1% of taxpayers.
The Market is an incredibly useful technology, but like all technologies it has limits to its domains of usefulness and harmlessness. When even a sometime-Randroid of Mr Greenspan's class can admit that in the run-up to the collapse actors in the Market failed to self-regulate, it's time for all but the most ideologically-hidebound to notice the fact.
Cato should beware, and learn better the use of nuance and heuristics even as they keep their base ideology, otherwise the exigencies of the Market will replace it with a simple bot-net running Eliza-like protocols running on top of a dog-eared copy of "The Road to Serfdom" with "How true!," scribbled in the margins.
It is truly maddening that, just 3 years after the largest global recession in history which was caused in large part due to predatory mortgage lenders, that anyone would argue against a strong federal agency designed to protect consumers from these type of lending abuses.
It looks as though you've never been around real businessmen, for whom the line between ethical and unethical, legal and illegal, is at best fuzzy. When your sole goal is maximising profit, and all your competitors trick loan-applicants, obfuscate credit agreements, and otherwise do their best to part their prey from their cash, it is near-impossible not to do so, just as it's hard to compete with a factory which is allowed to pollute as much as it needs to do to maximise production without polluting yourself. In both situations, an external agency independent of the Market is needed to impose (yes, with force, just as your property rights are imposed by force) a common set of rules to which all parties are subject, lest Pareto optimisation become a moral race-to-the-bottom.
We really must avoid the vice of pseudo-Calvinism, dividing people into unalterable ranks of fools and competent actors. Many of these "fools" were entirely competent at their professions, at raising children, and dealing with normal financial matters---and any sufficiently clever cheater will be able to cheat you, if not now, then perhaps in your dotage.
(Of course, some indulge in a burglar's morality: 'It is only right that I steal from them, they deserve it for not locking their doors well enough,' but this isn't why we bother to have a civilisation.)
No, we should not turn our society into a kindergarten, try as advertising and marketing does to turn us into infants---but when large numbers of otherwise-competent adults are conned, it's against one's own self-preservation not to ask that the practices that ensnared them be quashed...because you (and I, and Ms Rehm) are not fundamentally different from the ones who were victimised this time.
Listening to Elizabeth Warren speaking on the Daily Show and to Steven Colbert, she sure comes across as a wild-eyed zealot, not someone who approaches issues in a fair and open-minded manner. I can understand why there are strong objections to installing someone like that as the singular head of yet another unrestrained federal agency.
Mark Calabria
Is a right wing person how will never agree with Government oversight. It would be a very bad thing to not have the Consumer Protection Bureau under Elizabeth Warren as the head.
Mark Calabria director of financial regulation studies, Cato Institute is another arrogant rich, person that is a part of the "Koch brothers" whom only look out for their own only and they disregard the needs of the rest. The policy isn't working and hasn't worked for years. That is why we are in this financial situation now. The fox is and has been guarding the "hen house."
The libertarian & conservative philosophies of lowering taxes and deregulation would lead to a stronger and more prosperous America. What has happened with the lowering of taxes, creation of tax deductions that only the rich can utilize, deregulation of banking rules and regulations, and fostering an atmosphere at the regulation agencies to be friends of the banks and corporations rather then regulators? The top 1% wealth has increased 400% while the middle class and poor's wealth has decreased. Millions of people lost their jobs because of the banking crisis while the top bankers made more and more money. We have the greatest income disparity since 1929 right before The Great Depression.
And, what are the libertarian and conservatives solutions; lower taxes for the wealthy, cut entitlement programs, and convince the rest of us that regulations and government programs are the cause of the problems.
The fact that Republican congressmen are not willing to join this discussion is clear proof that they don't want to acknowledge that they want to kill a popular regulatory agency in an open process.
They would rather kill it by back door appropriation cut backs, and they couldn't argue that they support protecting the consumer in a radio discussion
Great show!
This bureau is critical to make changes in financial regulations necessary to protect us consumers. The Republicans consistently want there to be no regulation or weak regulation in this area. This piece of legislation adopted through the hard work of many Democrats must be funded and given a head as soon as possible.
It was lack of oversight, lack of regulation that got us into this big financial mess. Unless we take steps to provide effective oversight we will live to see more, serious, costly problems in the future.
The middle class continue to take it "on the chin" in this country. The disparity of wealth is a very sad commentary on what this country has become coupled with the loss of the "American dream".
I think that the DR show and NPR in general should rethink their frequent use of guests from so-called "think tanks" like the Cato Institute. Most of them are not the scholarly research organizations they pretend to be; they are funded to advance a particular philosophy. Their "research" is not disinterested, but designed to produce the desired conclusion, and it is not peer-reviewed in the normal sense.
Today's guest tried to imply that he wanted to change the CFPB in order to improve the financial system, when the real agenda of the Cato Institute and its benefactors is to kill it.
We have created corporations and teach our college graduates in ways to make corporations more efficient. Consumer financial protection laws have cost the banking industry $18 billion dollars. Now we are angry because free checking is going away and other fees are being charged. I think we are naive to think that banks or any corporation will not come up with ways to get that money back. The stockholders demand it. People will be fired if they don't. Without corporate reform we are up against a power much greater than any political movement. Our colleges teach the art of business finance, marketing, etc. We don't teach business consequences to the consumer economy. To the corporation people are a "necessary evil" and a liability that needs to be closely controlled. I believe the real reform needs to come from the complete restructuring of the corporation that includes the consumer as an integral part. Is that possible?
I assume it was Mr. Calabria who said (re. "irregardless")," I reserve my right to make up any word I want to." That statement reminds me of Humpty Dumpty who said, "When I use a word, it means what I choose it to mean--neither more nor less." Alice-in-Wonderland replied, "The question is, who will be master--you or the word?"
Mr. Calabria has strong beliefs about his "right" to do or say something, but the question is, can he control words--their meanings and interpretations? If you ask me, he crossed the line into arrogance and pomposity!
Lois M.
I understand that Republican’s main call to arms is pro business and a smaller government. How does making the new bureau a committee advance these goals? Isn't it common sense that one person is less than five? Paying one person instead of five will save us (taxpayers) money as well...
Yes, she comes across as someone fanatically against persons' being cheated, legally or illegally, and is obviously an idiot because she is firmly on the side of the weak against the strong.
The pay is irrelevant on the scale of the amounts in question.
Business would prefer five persons to one because for the next two, and quite possibly six, years that one person will be someone not considering their interests first and only. Yes, eventually a Republican will come into power, but by the time President Jenna appoints Grover Norquist head of the agency, people will have got used to the idea that they deserve and can get some protection, just as they became used to the idea of getting some sort of guarantied security in their old age.
A committee, on the other hand, is often the very best way to get nothing done at all.
The Republican Party wants to keep Consumers misdirected. The Consumer Protection Agency will guard the public from the wolves (Big Business). We have seen what Big Buisness does among itself. They cannablized those firms that could secur no governent help or protection. Lehman Bros., Bear Sterans. What the banks (Republican Party) want is to have a chance to fleece the public further. There are fewer and fewer people with less and less money. What would have happend to this country if as the Bush administration suggested we had invested the Social Security funds in Wall Street. There must always be a free unbiased single source to protect the financially unsophisticated
First of all, we know politicians always misname agencies so as to misdirect criticism. So we know Consumer Protection is probably the last thing this new bureaucracy is going to do besides consume middle class tax dollars.
Secondly, this seems like overreaching by the nanny state. I want more, not less, freedom when it comes to my consumer finance options.
I would give more credit to the critics of Cato and "Callabria" if they could refute some facts, but alas all they can do is criticize their language and tone and refer to think tanks with generalities. Waste of time.
I also find it painful to hear Diane get testy towards people she can't argue against.
LOVE this show!
Like many Americans, my family is one paycheck away from total financial disaster. Created to protect our most vulnerable citizens, and to stop corporate greed, it is totally unthinkable that our Legislature would NOT endorse the CFPB with Elizabeth Warren as its head!!!
(btw, to the Senator who said "irregardless", EVERYONE knows that isn't a word! "Irrefutable" come to mind, anyone? To say, on the air, that you can make up, AND then say whatever word you want makes you sound very immature, and makes me wonder exactly why you were so......uh, blustery just about a non-word.)
It would be nice if the PTB would truly think about the many "little" people who elected them!
Hey Accountant:
How about those State Lotteries? Who do you think plays them the most? Yea the poor and the uneducated. Politicians are not going to do anything about them even in very Democratic states because of the revenue they get from it?
Hey Accountant:
How about those State Lotteries? Who do you think plays them the most? Yea the poor and the uneducated. Politicians are not going to do anything about them even in very Democratic states because of the revenue they get from it?
Libertarian, or not, your guests make some good points about the future efficacy of the new bureau. I think it was in Capitalism: A Love Story, where Elizabeth Warren's efforts to warn against potential fraud in the financial industries (derivatives, in particular) and pending financial failure were not only poo-pooed by her peers, but ended in her ouster. Whether headed by a commision or a commisioner, any government agency is potentially corruptable, which is why the funding should remain independent. Unfortunately, The Federal Reserve, like Fannie Mae and Freddie Mac, is a quasi-government agency. All these agencies were originally (ostensibly) instituted to protect consumers, but over the years, they've been corrupted to protect bankers, financiers, and investment brokers. Blaming regulators for our financial crisis after thirty years of lobbying for deregulation is absurd. Perhaps, what we need is a wholly independent (from private banking), public, commercial banking system, totally seperate from investment banking; or, at minimum, a re-instating of the Glass-Steagall Act. This woud be a good first step in protecting small investors, and in ending "too big to fail."
"monte wrote:
No judgment calls in politics? OK, it would be hard to cast a vote though.
"Consumer Financial Protection Bureau" we need this to help people understand a loan contract, not be charged when they exceed their credit limits when they buy a cup of coffee, not be charged late fees when they make their credit card payments on the day before it's due and on and on. Sorry you just cannot help people like this without punishing the responsible. In other words the responsible will just pay for stupidity of others who just will not change their ways and this nonsense will only make matters worse and cost the economy more jobs. This is just another form of wealth redistribution.
May 5, 2011 - 10:17 am"
The responsible don't have to pay the Penalties, Stupid!
Anyhow it's usually the Stupid (us ordinary Folks) that have to pay for the mistakes of the Responsible with our Pensions, and Medical care for our selves and Babies.
If a depositor is going to be slightly overdrawn on a particular day, the banks will hold all the checks that come in that day, then present them in order of largest to smallest value to maximize the number they can bounce and extort overdraft Penalties for. And worse, they charge the Penalties immediately, further shrinking the Balance and causing more checks to bounce.
They can and do completely empty an account in that way.
They have been sued and have had to back down, but IMO, they should have been thrown in Prison.
Monte Haun mchaun@hotmail.com
Representative Spencer Bachus was invited. He declined. As one of his constituents I am MOST disappointed. There are homeowners in Alabama who need more consumer protection--some tragically lost homes in the recent ferocious storms.
http://www.npr.org/2011/05/05/136028754/in-alabama-tornadoes-wiped-out-u...
We need to hear from our Congressman!