Consumer Financial Protection Agency

The move this week to downgrade a proposed Consumer Financial Protection Agency to lure bipartisan support instead appears to be undermining the Obama administration's effort to overhaul the nation's regulation of the entire industry. The overhaul, aimed at preventing a repeat of the economic meltdown that helped send the nation and world markets into a deep recession, now might be moving closer to the junk heap of congressional bills than to a significant new law. Creating a powerful and independent consumer agency, which is strongly opposed by the financial industry and Republicans, has been the major roadblock in drafting a bill that could pass in the Senate.

President Obama cast his recess appointment of a new consumer watchdog as fresh proof of his commitment to surmount congressional gridlock and take action meant to shore up a struggling middle class - a major theme of his 2012 reelection bid. Obama used his 17th trip to Ohio, a key swing state in the presidential race, to formally announce that he is installing Richard Cordray as the first head of the new Consumer Financial Protection Agency....

President Obama may be forced to accept a watered-down version of his proposed consumer protection agency to get a sweeping overhaul of financial regulations approved by Congress. Senate Banking Committee Chairman Christopher J. Dodd (D-Conn.) is circulating a proposal that would scrap plans for a Consumer Financial Protection Agency, which Obama has touted as crucial to protecting consumers from predatory mortgages, credit cards and other products. He and administration officials say the agency is key to avoiding a repeat of the financial crisis that rocked the country in 2008.

By announcing major changes in his economic team ahead of the midterm elections, President Obama is hoping to galvanize a listless Democratic base that has been unimpressed with the administration's efforts to ease unemployment and buoy the still-troubled housing market. The two key moves — Lawrence Summers' exit as top economic advisor and Elizabeth Warren's ascendance as a consumer protection czar — are widely viewed as overtures to liberal Democrats, a voting bloc that must turn out in large numbers if the party is to stave off deep losses in the Nov. 2 congressional elections.

A House committee voted to create a federal agency to protect consumers in the financial marketplace, but several days of often-contentious debate showed that obstacles still confront one of the centerpieces of President Obama's overhaul of industry regulations. Despite strong Republican opposition and intense lobbying from banks and business groups, the new Consumer Financial Protection Agency survived its first major test Thursday when the House Financial Services Committee approved its creation 39 to 29 in a largely party-line vote.

As the Senate debates a bill to overhaul financial regulations, its backers have fended off a series of attacks on one of its centerpiece reforms: a new consumer protection agency. Still, opponents of the Consumer Financial Protection Agency keep trying to narrow its reach, contending that it threatens to make vital forms of credit less available and more expensive. A critical test for the new agency is expected this week, when the Senate takes up a proposal by Sen. Sam Brownback (R-Kan.

President Obama's focus, we're now told, is on jobs, jobs, jobs. That's nifty, but it doesn't bode well for other big-ticket policy goals, such as creation of a Consumer Financial Protection Agency to safeguard us from abusive bank practices. That idea, which Obama championed and leading Democratic lawmakers embraced, is now expected to be a long shot thanks to ferocious opposition by the banking industry, which says no additional regulatory oversight is needed. No? Here's an economic statistic that suggests otherwise: The number of credit card solicitations mailed to consumers rose during the last three months of 2009 for the first time in three years, according to Mintel Comperemedia, a Chicago market-research firm.

As legislation advances in Congress to crack down on consumer-unfriendly lending practices, staffers in the offices of California Sens. Barbara Boxer and Dianne Feinstein noticed a funny thing this week: Customers of payday lenders were calling by the hundreds to oppose the bill, and all seemed to be repeating the exact same phrases. The staffers were right to be suspicious. Payday lenders are notorious for their high fees and interest rates, and they may face new restrictions as part of efforts to overhaul the financial services industry and create a Consumer Financial Protection Agency.

Denial, noun: An unconscious defense mechanism characterized by refusal to acknowledge painful realities, thoughts or feelings. -- The American Heritage Medical Dictionary -- The banking industry wasted no time last week declaring its opposition to President Obama's proposal for a regulatory agency that would protect consumers from rapacious lending practices. While acknowledging that "regulatory reform is badly needed," Edward Yingling, president of the American Bankers Assn.

President Obama, pushing a key part of his overhaul of financial regulations, sent to Congress a draft bill that would create the Consumer Financial Protection Agency, which he said would better protect Americans from unscrupulous practices and make financial products easier to understand. Under the 152-page bill released Tuesday, the new agency would bring together what the administration called the "fragmented" system of responsibility for consumer protection.

As the Senate debates a bill to overhaul financial regulations, its backers have fended off a series of attacks on one of its centerpiece reforms: a new consumer protection agency. Still, opponents of the Consumer Financial Protection Agency keep trying to narrow its reach, contending that it threatens to make vital forms of credit less available and more expensive. A critical test for the new agency is expected this week, when the Senate takes up a proposal by Sen. Sam Brownback (R-Kan.

The debate over the Senate's financial reform bill is setting up an unusual battle on Capitol Hill between two powerful groups: automobile dealers and the military. Car dealers, a well-organized small-business lobby with members in nearly every legislative district, have swarmed the Senate in recent weeks clamoring to be exempt from the legislation's proposed protections against loan scams. They say the tough new government oversight should focus on the big Wall Street firms that caused the financial crisis, not auto dealers struggling to recover from it. "There's a lot of dealers that are still on the brink, and taking their finance revenue away from them could be the straw that breaks the camel's back," said John Symes, who owns three auto dealerships in Pasadena.

As legislation advances in Congress to crack down on consumer-unfriendly lending practices, staffers in the offices of California Sens. Barbara Boxer and Dianne Feinstein noticed a funny thing this week: Customers of payday lenders were calling by the hundreds to oppose the bill, and all seemed to be repeating the exact same phrases. The staffers were right to be suspicious. Payday lenders are notorious for their high fees and interest rates, and they may face new restrictions as part of efforts to overhaul the financial services industry and create a Consumer Financial Protection Agency.

With memories of the financial crisis already fading, Senate Banking Committee Chairman Christopher J. Dodd tried to jump-start the stalled effort to pass a major regulatory overhaul this year that would protect the public from another economic meltdown. Dodd's latest version of the legislation, unveiled Monday, is more modest than the ambitious ideas President Obama called for a year ago, but it still would be the most sweeping financial reforms since the Great Depression. With the Connecticut Democrat unable to secure any Republican support after weeks of intense negotiations -- and with the legislative clock winding down -- he warned that senators needed to act soon to prevent a financial fiasco from again severely shaking U.S. and world markets.

Legislation to be unveiled Monday by Senate Banking Committee Chairman Christopher J. Dodd to overhaul the financial regulatory system is likely to be more modest than either the Obama administration's proposal last summer or a plan Dodd pushed last fall. Dodd, a Connecticut Democrat, was set to release detailed legislation for the most sweeping overhaul of financial regulations since the Great Depression, which Democrats want to pass before the fall elections. Tightening federal oversight of the financial system is designed to prevent a repeat of the banking-system meltdown in 2008 and is a priority of President Obama.

Payday lenders didn't cause the economic crisis, but consumer advocates hoped their sky-high interest rates on loans would be reined in as part of a sweeping regulatory overhaul to prevent a repeat of the financial fiasco. However, key senators feverishly working to craft a bipartisan bill want to make payday lenders -- companies that offer short-term loans to tide people over until their next paycheck -- largely exempt from oversight by a new consumer financial protection agency.

By announcing major changes in his economic team ahead of the midterm elections, President Obama is hoping to galvanize a listless Democratic base that has been unimpressed with the administration's efforts to ease unemployment and buoy the still-troubled housing market. The two key moves — Lawrence Summers' exit as top economic advisor and Elizabeth Warren's ascendance as a consumer protection czar — are widely viewed as overtures to liberal Democrats, a voting bloc that must turn out in large numbers if the party is to stave off deep losses in the Nov. 2 congressional elections.

Re: "Geithner tries to safeguard new watchdog," July 25: You write that the proposed Consumer Financial Protection Agency is in danger because of pressures from "the industry it would regulate and its allies in Congress." The only solution to give the public a fighting chance against the well-funded powers is for the adoption of legal, voluntary public funding of elections. This has worked well in Maine and Arizona and the other states. Emil Lawton Sherman Oaks

The move this week to downgrade a proposed Consumer Financial Protection Agency to lure bipartisan support instead appears to be undermining the Obama administration's effort to overhaul the nation's regulation of the entire industry. The overhaul, aimed at preventing a repeat of the economic meltdown that helped send the nation and world markets into a deep recession, now might be moving closer to the junk heap of congressional bills than to a significant new law. Creating a powerful and independent consumer agency, which is strongly opposed by the financial industry and Republicans, has been the major roadblock in drafting a bill that could pass in the Senate.

President Obama may be forced to accept a watered-down version of his proposed consumer protection agency to get a sweeping overhaul of financial regulations approved by Congress. Senate Banking Committee Chairman Christopher J. Dodd (D-Conn.) is circulating a proposal that would scrap plans for a Consumer Financial Protection Agency, which Obama has touted as crucial to protecting consumers from predatory mortgages, credit cards and other products. He and administration officials say the agency is key to avoiding a repeat of the financial crisis that rocked the country in 2008.