Strict Consumer Protection or Nothing
You would think that protection of consumers, who lost their homes, businesses and jobs because of the shenanigans of the financial industry, would be a high priority of both Democrats and Republicans in the Senate. Not so. It seems that satisfying bankers and Wall Street, who melted our economy, comes first.
The House passed a decent consumer protection bill. The Senate Banking Committee Chairman, Christopher Dodd, is fiddling around - "talking" to Republicans - while consumers are burned. Though Dodd started with a decent independent protection agency his Republican friends want no such thing. An independent agency would be hard for the financial guys to control. The financial guys want the Fed, which is run by banks for the banks, to be in charge. If not the Fed, then maybe the Treasury Department, which is run by Geitner and other financial allies. The Republicans want to have a consumer protection agency, but not one that has any teeth.
Elizabeth Warren, the federal bailout watchdog, does not care where the agency physically exists as long as it has four simple attributes:
* A chief appointed by the president, confirmed by the Senate;
* Independent budget authority, so it won't be subject to the whims of Congress or an anti-consumer administration;
* Independent rule-making authority, without interference by bank regulators or others who may focus on bank profitability before focusing on consumers;
* And independent enforcement powers, so the agency's investigators can go after abusive lenders.
The House bill meets these requirements. The way things are going in the Senate, the Senate bill will not. Warren states her opinion about this unequivacally:
My first choice is a strong consumer agency. My second choice is no agency at all and plenty of blood and teeth left on the floor.
No consumer agency is better than having an agency that allows financial predators to get away with horrible scams. Better to vote against phony regulation and point the finger at those favoring it. Proponents of a weak agency should be politically attacked in November.
Only a strong and independent consumer protection agency will do. We must have strict consumer protection or nothing.
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