The Little Guy Screwed - You Can BANK ON IT!

The U.S. Senate just used a sixty-day review period for a new regulation from the Consumer Financial Protection Bureau - set up to prevent the banks from wielding too much power over its customers - to kill the regulation.  Had it ever gone into effect, this new rule would have made it easier for customers to sue banks for damages done to them; now, they can only go through arbitration, where banks have the upper hand, and there's no way that the rule can be reinstated in the future - ever.  Republicans in favor of the repeal said it protects smaller banks from frivolous lawsuits, but as Stephanie Ruhle of MSNBC said, even the smallest bank is more powerful than the customers it's screwing.  Vice President Mike Pence (above) cast the tie-breaking vote against the rule.  Well, you can't blame Trump for this, though you can blame the Republicans and also the banking lobbyists.

But you can also blame the Democrats in part for how we got here.  The Consumer Financial Protection Bureau (CFPB) was set up to reign in banks after the 2008 financial crisis - which I call 9/15, as it occurred when the stock market tanked on September 15 - and that bureau was necessary due to the lack of a law regulating bank operations. There had been a law like that once . . . but the Glass-Steagall Act, which required the separation of commercial banking and investment banking, was repealed in 1999.  It was signed into law by Bill Clinton, a Democratic President.  After the CFPB was set up, the Obama Administration presided over a number of prosecutions of bankers for destroying people's lives.  That number, alas, was zero.   

And in the 2016 Democratic presidential primary/caucus campaign, only one of the top three contenders for the party's nomination opposed restoring the Glass-Steagall Act.

And here is that candidate.

Who were you expecting, Martin O'Malley?

In fact, here's what O'Malley said about 9/15:

Oh yeah, Hillary just turned seventy the other day, and having made it to three score and ten, she should just fade away (and so should Donald Trump, 71 - so let's get that straight).  But she's still out there, "helping" the Democratic Party while trying to make sure it stays on its current neoliberal, pro-business course, nearly a year after she - like the Democratic Party long before - became politically irrelevant.  :-( 

And now that this consumer-protection rule has been repealed before it even took effect, the news media can resume talking about the Kardashians or whatever. >:-(   

A Consumer's Report

The good news is that we have a Consumer Financial Protection Bureau. The bad news is it may never do the job it's intended to do. See, Republicans have a few issues with the Consumer Financial Protection Bureau. They're very much for it, except for the consumer financial protection part.

Be that as it may, they've made it clear that they would never submit to the appointment of Elizabeth Warren, the Harvard financial expert who got the goshdarn agency up and running, to serve as its first chairperson. It seems she sides with ordinary folks too much. So Ms. Warren, whom they don't trust enough not to do the job, won't be getting it. President Obama has appointed someone else.

If you're a fan of making big banks and financiers behave, you're not going to like David Corn's article for Mother Jones magazine, in which Corn explains that Ms. Warren was too controversial for Obama to nominate. He couldn't even nominate her for a recess appointment; Republicans have conspired to keep Congress in session, a trick Democrats dared not try to block George Walker Bush's nomination of noted xenophobe John Bolton as ambassador to the United Nations. (Rumor has it that United Nations delegates still spit on the ground at the mention of Bolton's name. I started the rumor just now. :-D) So Obama nominated Richard Cordray, a former Ohio state attorney general, to head the agency. The good news is, he shares Elizabeth Warren's views. The bad news is, he shares Elizabeth Warren's views.

But that's not all. Republicans are concerned with the agency's separate budget and perceived lack of congressional oversight that would give the eventual chairperson way too much of a free reign in, well, regulating Wall Street. They've also complained about the CFPB being one more burdensome bureaucracy (because it would hinder shady Wall Street dealings) and it wouldn't be accountable to Congress . . . only to the people. Forty-four Senate Republicans have singed a letter vowing not to let any CPFB chairperson nominees be voted in the Senate unless Obama agrees to changes in the CFPB that would have more congressional oversight . . . and thus more congressional meddling to weaken and emasculate the agency. So, even Cordray's appointment is likely dead on arrival.

Obama may have had strategically good reasons not to appoint Ms. Warren, but this allows her to possibly run for the U.S. Senate in Massachusetts against Republican incumbent Scott Brown next year. Bay State Democrats lost this seat - Ted Kennedy's in a special election by nominating a horrible candidate, and the possibilities for the Democratic U.S. Senate nomination in 2012 are even worse. Brown is the favorite in this Democratic state. Elizabeth Warren, with her feistiness and her populism, would make a great candidate as well as a great senator, and she's indicated that she might run. I hope she does. Because none of the other nine Republican U.S. Senate seats up for re-election in 2012 - did I mention the Democrats have 23 U.S. seats up for re-election next year? - are likely to flip.

If you can find a Democrat to unseat Mississippi's Senator Roger Wicker, more power to you. But Democratic hopes of stemming Senate seat losses in 2012 and possibly preserving their majority center on a vigorous Elizabeth Warren candidacy in Massachusetts.

So what will happen to the CFPB? Republicans will stonewall any nominee for the post until they finally win back all the power they had under Bush and abolish it.

Sorry.

Elizabeth The First

Elizabeth Warren got the appointment many have hoped she would get, the job of starting up the new Consumer Financial Protection Bureau. Her record in protecting the little guy from unscrupulous lenders and credit card companies has been seen as being essential to establishing a sense of integrity to the new bureau, as well as putting real teeth into it and giving it the momentum it needs to get up and running and enforce the new provisions of the financial reform law.

President Obama appointed her on an advisory basis to avoid a Senate confirmation, in which Republicans - who mostly opposed the law on the grounds of government overreach - would have surely blocked her. Warren has eighteen months - plenty of time - to get things moving. The move delighted liberals, who have been wanting in things to cheer about, but this appointment alone won't get the Democratic party base to the polls to offset Republican gains. Obama has shown signs that he's only beginning to fight, but time is of the essence. Nevertheless, Warren's appointment to this job is a big morale boost.