September 18, 2009
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Obama Refuses to Back Down on Consumer Protection Agency, Pt.1
Closing the loopholes.Banks, credit card companies, and the U.S. Chamber of Commerce are sitting on the opposite side of the table from President Barak Obama. The newest confrontation stems around the proposed consumer protection agency at the center of the President's financial reform. The U.S. Chamber is speaking out and wants credit card consumers and all Americans to hear its message loud and clear. The agency has embarked on a $2 million advertising campaign by sending out thousands of emails to Chamber members across the nation asking them to join them in fighting against Obama's proposal. Banks and credit card companies have been visiting Washington to voice their opposition and saying such a new agency would be a government takeover and interferes with the company and their clients.
Earlier this week, President Obama delivered a speech to Wall Street executives saying that new regulation would "close the loopholes" that have allowed greedy individuals to prey on Americans in the past. He also indicated that it was this oversight and abuse that weakened the system and lead to the financial collapse. According to Obama, a new consumer protection agency would centralize the power to one agency rather than the current multiple agencies that are typically unaware of what the others are doing. Such an agency would regulate mortgage and credit card transactions that are currently overseen by several agencies including the Federal Reserve, Federal Deposit Insurance Corp. and Office of the Comptroller of Currency. The agency's aim would be to clarify the confusing language in mortgage contracts, eliminate risky loans, and enforce new credit card reform regulations.
President Obama announced his support for the agency just a few short weeks after signing the new credit card reform bill. The proposal is contained in a bill drafted by Representative Barney Frank (D-MA), Chairman of the House Financial Services Committee. The committee is scheduled to continue the bills debate on September 30th. It is estimated that Congress has already received during the last month alone, over 22,000 letters in opposition of the new legislation.