October 9th, 2009
04:05 PM ET
13 years ago

Obama pushes consumer protection agency

[cnn-photo-caption image= http://i2.cdn.turner.com/cnn/2009/images/10/09/art.obama1005.gi.jpg caption="Palin argues against the president's health care proposals in a new Op-Ed."]
NEW YORK (CNNMoney.com) - President Obama on Friday made his strongest push yet for the creation of a new consumer protection agency, lashing out against those who have lobbied hard to stand in its way.

The Obama administration sent Congress its proposal for a Consumer Financial Protection Agency in late June. The proposal has been met with disdain from banks and big business.

"They're doing what they always do - descending on Congress and using every bit of influence they have to maintain a status quo that has maximized their profits at the expense of American consumers," Obama said in televised remarks made at the White House. "That's why we need a Consumer Financial Protection Agency that will stand up not for big banks and financial firms, but for hardworking Americans."

Banks succeeded last month in stripping out of the bill a provision that would have required banks and others to offer uncomplicated financial products, like easy-to-understand applications for 30-year-fixed mortgages, as alternatives to more complex ones.

The president reserved his harshest criticism for the U.S. Chamber of Commerce, which he said "is spending millions on an ad campaign to kill" the proposal. The Chamber of Commerce launched an ad campaign opposing the proposal, featuring a butcher and baker concerned about its possible impact on their businesses.

"This, of course, is completely false - and we've made clear that only businesses that offer financial services would be affected by this agency," Obama argued.

The agency would set more transparent rules for financial institutions to ensure that consumers get help in understanding the terms of their loans and agreements. But banks have opposed another regulator that some believe could threaten the soundness of financial institutions.

"We disagree that a massive new federal agency with unprecedented powers over vast segments of the business community will be good for consumers," said David Hirschmann, CEO of the U.S. Chamber Center for Capital Markets Competitiveness, in a statement. "The proposed CFPA will exacerbate the weaknesses of the current system that clearly failed, restrict access to credit and make it more costly for consumers and businesses."

Still, the White House and many in Congress are undeterred. The House Financial Services Committee is set to hold a hearing on Wednesday.

Filed under: President Obama
soundoff (74 Responses)
  1. Todd (not the Alaska Separatist)

    A welcome change after Michael Baroody, George Bush's failed nominee for spearheading Consumer Protection. Baroody was the point guy on a long list of Hall of Shame items including going to bat for cigarette companies to lace cigarettes with chemicals that keep them burning – and cause fires every year that burn families to death. But hey that is what being a Republican is all about – embracing Evil.

    October 9, 2009 06:17 pm at 6:17 pm |
  2. We Won Get Over It

    Why in the world don't the Democrats go ahead. The republicans do not want any curbs on big business so they do their best to stop every thing. Obama and the Democrats have tried to get republicans to help in trying to put this country back in order. They don't seem to want to, so the best thing to do is ignore them and full steam ahead. Show the country what a bunch of anti-American deadheads they really are.

    October 9, 2009 06:22 pm at 6:22 pm |
  3. Terry, TX

    We don't need any other agencies....created....

    October 9, 2009 06:43 pm at 6:43 pm |
  4. J.C. - Independent

    Yes, we desperately need a CFPA to protect general public from the greed of big corporations in finance. Congress represents the rich for campaign donations and the poor for votes. When we have got little Middle Class in between, that is a dictatorship in the making that we don't want.

    October 9, 2009 06:45 pm at 6:45 pm |
  5. Wade

    Hard working Americans, as well as ALL Americans need to be protected from "financial predators"! The time has come for reform in this regard! It is far past time to REIGN IN THE CREDIT CARD COMPANIES! THEY ARE TAKING US TO THE CLEANERS!!!
    I'll let you in on a secret... pay your bills on time and the evil credit card companies leave you alone.
    It's the deadbeats that run up crazy high debt and then default while trying to keep up with the Jones' that caused this mess in the first place.
    Everyone wants to blame someone else for their own mistakes.
    Now the rest of us suffer for it.

    October 9, 2009 06:51 pm at 6:51 pm |
  6. Wade

    Jim in San Mateo
    Have you seen what the banks are doing to credit card holders. I'm not talking about the ones who are behind on their payments or who only make minimum payments. I'm talking about the ones who have great credit who are seeing their minimum monthly payments triple and their interest rates (guaranteed to stay low) double.
    Again... blame it on the deadbeats who failed to pay their bills.
    Their default on their card payments has to be recovered from somewhere.
    Credit card companies and banks are not philanthropic organizations. They are in business to make money.
    They extend credit on the promise that the consumer will pay it back.
    If the consumer fails to pay it back, the lender is forced to increase the costs/requirements on those of us who are in good standing to make up for the loss.
    When they start losing money hand over fist from all the deadbeats, they need to jack up the rates on everyone else or risk going out of business themselves.
    If they go out of business guess what? You lose your line of credit, but still owe the money on your balance,

    October 9, 2009 06:59 pm at 6:59 pm |
  7. Jane/Seattle

    These big giant corporations NEED TO BE REGULATED, Broken UP, and controlled for the benefit of the American citizen, who just were/will be made to pay to fix the bankruptcy of the Oligarchy! How does any government official look into the mirror knowing that this has been one giant swindle by a complicit government in league with their corporate masters.? Why are the bankruptcy laws to punish the poor, working poor, and middle classes kept in place while the violaters of the very most sacred rules of Capitalism are allowed to rob these Commons? If you fail, you fail. This is the tenet that the little guy must abide by in life. Why is Equality ignored for the Wealthy Elites? Because the laws are written and rewritten for the benefit of these Plutocrats! Figure this out, Republican Followers into Hell! You are continuing to be duped by false pretenses. Peace to all.

    October 9, 2009 07:01 pm at 7:01 pm |
  8. Victim of Liberal stupidity

    Too bad that this latest unbelievable feat of super human multi-tasking skill comes after most American consumers are now unemployed and have gone broke. Do not worry though America, Obama is going to take care of us, he will just print some more money!

    October 9, 2009 07:16 pm at 7:16 pm |
  9. Ray in Nashville

    @ Ridgeway

    President Obama was elected because the people of the United States were fed up with the rampant crony politics of the Bush/Cheney regime and the virtual crumbling of the US economy thanks to close to 30 years of trickle down economics that heavily favored the very wealthy over the majority of the population of this country.

    It is the duty of our government to protect American citizens. That includes protecting them against the predatory practices of big business and, to quote Theodore Roosevelt, the "wealthy criminal class." The government we have had for the past 30 years, whether Democrat or Republican controlled, has done their level best to remove that protection. It's about time President Obama began to work to re-institute a protective shield for the American people.

    October 9, 2009 07:30 pm at 7:30 pm |
  10. Matthew

    Please, we've got enough agencies. We just need to make them more efficient and get rid of those that don't do anything (department of energy: set up by Carter to reduce our dependance on foreign oil). These agencies are funded by taxpayers and don't work.

    October 9, 2009 07:31 pm at 7:31 pm |
  11. ThinkAgain

    One of the most essential things that needs to happen is the re-institution of the Glass-Steagall Act.

    No more allowing investment banks and their gambling-addicted employees access to savings banks assets.

    Bank holding companies should NOT own other financial companies! The investment banks have proven beyond a shadow of a doubt that they have no regard for the saved money of hard-working depositers.

    They've also shown that, for all their talk about "free-market capitalism," they don't have a problem running to the government to bail them out when their schemes collapse.

    NO WAY, NO MORE!!!!!!

    October 9, 2009 07:39 pm at 7:39 pm |
  12. ThinkAgain

    Why is it that when Cheney/Bush were lying us into a war, trampling the Constitution by using illegal wiretaps, extraditing "enemy combatants" to undisclosed locations, meeting with oil company executives in private, ignoring briefings about the possibility of being attacked by Al Qaeda using airplanes, responding to Hurrican Katrina by sending in a horse show judge, de-regulating the financial industry, etc., etc., all these rightwing posters were thumping their chests and calling anyone who disagreed with them "anti-American".

    And now, when we have a president who is intelligent, hardworking (no brush-clearing for him for over 500 days), has the respect of the international community, pulled us away from the brink of a devastating economic Depression, has the respect of the armed services because he actually consults with them – NOW, people are claiming they're being "dictated to"?

    Just what planet are you from?

    October 9, 2009 07:46 pm at 7:46 pm |
  13. Deborah Black

    Stand strong Mr President, keep fighting for us. All this fake animosity toward you will fade if you keep the faith. Get this passed, but most of all get the public option passes for healthcare. The insurance industry is raping American citizens more than the banks, because the Insurace companies profit from our deaths. Congrats you Nobel Peace Prize Winner, the world loves you.

    October 9, 2009 07:54 pm at 7:54 pm |
  14. Steve (the real one)

    Make what we already have BETTER! Not BIGGER!

    October 9, 2009 07:58 pm at 7:58 pm |
  15. Marc

    Folks, did you know that until the 1930's child work in mines was still legal in the US? Then the govt. said 'NO, stop that, it's ruining their health and depriving them of education'.
    Guess who was against this 'interference' of the Govt. in a 'private business'?
    And guess who was for it?
    Nearly 80 years later they are still clueless about what are the obligations of the government towards the people it represents...

    October 9, 2009 07:58 pm at 7:58 pm |
  16. Stu

    Great, another government entity we have to pay for. Anyone who believes the government actually has the power to control the banking industry is inhaling what they smoke.

    October 9, 2009 08:01 pm at 8:01 pm |
  17. Give me a break

    If you remember it was then President-Elect Obama who urged President Bush to pass TARP for the good of the country.

    How funny it is that most liberals are so blinded by idology that they don't let facts get in the way. Or was it a good old Chicago trick of getting someone else to do the dirty work so you could keep your hands clean and critize instead.

    October 9, 2009 08:06 pm at 8:06 pm |
  18. pala6

    There is a difference between capitalism and greed. American law makers must fix it yesterday!!!

    October 9, 2009 08:16 pm at 8:16 pm |
  19. Ted Tartaglia

    If the banks and the Repubs are against it, it must be a good thing. These greedy miscreants are responsible for the current economic condition.

    October 9, 2009 08:17 pm at 8:17 pm |
  20. Ryan, Council Bluffs

    And paid for by... taxpayers, consumers, oh thats right evil businesses that must pay a fee or tax which of course will not be passed along to consumers. There are way too many regulatory agencies in the US. I'll let Barack have his if he consolidates each everyone of the others.

    October 9, 2009 08:18 pm at 8:18 pm |
  21. TRUTH

    the best for the DEMS, the gop and m. steele was only negative-terrible. GO DEMS the prez, house,senate, next up the supreme kourt

    October 9, 2009 08:20 pm at 8:20 pm |
  22. Debbie

    I'm for a Consumer Financial Protection Agency. The everyday citizen needs an advocate against banks, financial firms, insurance companies and big business. They have used their money, power and influence with politicians and almost nullifying the citizens vote.

    An example is the US Chamber of Commerce. I am all for businesses advocating for their businesses but they are out of line when it comes to issues of my health care. Since I have no power against the US Chamber of Commerce I have organized and exercised my right to boycott all local businesses that are part of our local chamber. If they want to spend their dues to help the US Chamber to take away my rights then I will spend my time, money, and efforts to take away their profits through boycotts.

    The Obama administration sent Congress its proposal for a Consumer Financial Protection Agency in late June. The proposal has been met with disdain from banks and big business

    October 9, 2009 08:25 pm at 8:25 pm |
  23. Tired

    I wish some of you people who have decided that everyone who is unemployed, underemployed, lost a current job, living belong the poverty line etc. is there only because he is a loser that has made "poor choices"!!!! Come work in Human Resources for awhile.
    You will see how many people are out of work due to vicious corporate choices. Work outsourced, other employees working 60 hours a week to make up for layoffs and told "be glad you have a job". Talk to people who put 30-35 years into a company. Did their part and in their late 50s get told they are out. Did I mention they are also not going to get the pension they worked for? Or that healthcare for life they were promised? Try being that age and looking for employment. These people are willing to do anything..including scrubbing the bathrooms.....to have a job and hopefully get some health coverage in their older years. Try being a parent with a special needs child looking for work where they need special hours to accomodate child care needs. Employers today will not work with you! When the only consideration of corporate America is the bottom line and the bottom line is for the investors and top 1% we have no equality. There is no longer a "trickle down". I will admit it was once out there but no longer. Everyone who is old, sick, burdened with a low IQ is not some loser who is in the position he is due to his own actions. Many of these people try and some who no longer try have been beaten down once too often. They don't know where to go or what to do next. AAAhhhh! Part of me hopes that everyone of you who thinks you are on your way up the corporate ladder because of your wonderful personality and work ethic get knocked off the ladder yourself. Perhaps then you can find some compassion for the less fortunate.

    October 9, 2009 08:34 pm at 8:34 pm |
  24. grimsmiley

    Big business says these new regulations won't work. That's because they will PURPOSELY make them not work! Actually, they're doing it now, why is it harder than ever to get a loan after Trillions were spent to bail the banks out? It's like the kid who takes his ball away when the game isn't going his way...only they're dealing with peoples LIVELYHOOD!

    October 9, 2009 09:02 pm at 9:02 pm |
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