Financial consumers would have fewer protections than originally envisioned under a draft of a bill being circulated on Capitol Hill.
The latest proposal for a Consumer Financial Protection Agency would no longer require financial institutions to offer a “plain vanilla” version of its products, such as a basic 30-year fixed rate mortgage. That would free lenders to concentrate on selling more sophisticated and expensive products.
The changes were proposed in a memo sent to Democratic members of the House Financial Services Committee on Tuesday evening by its chairman, Barney Frank.
The financial crisis sparked the idea for the agency, to make financial products safer for consumers. Advocates say such an agency could have prevented the subprime mortgage crisis and the resulting financial meltdown.
The agency would be able to examine and subpoena information from banks, while regulating financial tools such as mortgages and credit cards. Such an agency could determine the language on loan applications, how it’s presented and what the disclosure requirements are.
The new proposal would exempt non-bank businesses — such as merchants and retailers — from oversight. That means they could continue to offer customers tabs and layaway plans without facing a new layer of regulation, Frank’s memo said. Accountants, real estate brokers and agents also would be exempt.
Oddly enough, the banks are less than thrilled with the idea of this agency and would rather kill it outright.
#54 Phydeau
Right. You said it better than I could.
To the libertarians – don’t get me wrong what we have is far from perfect. And perhaps some libertarian ideas would make the country operate better. But the broad idea as a replacement, it just doesn’t fly with reality.
#56 And I think the “big” corporation would become a thing of the past if it was (well, you would need to repeal most of the regulations that hurt the small guy, too).
I think this is what libertarians are really pining for — a simpler time, with no big corporations and no big government, when people had enough expertise to deal with everything they came in contact with. Who knows, libertarianism might really have worked then, if that time ever really existed. But it sure isn’t the reality we’re dealing with now, which is why libertarianism will remain forever theoretical, the wrong solution at the wrong time.
#61, I think this is what libertarians are really pining for — a simpler time, with no big corporations and no big government,
Not simpler. Righter.
#57
“This is exactly what I mean. Oh I just go and figure it all out then. Well that’s easy. You obviously haven’t bought health insurance recently. It’s sooo transparent and simple.”
Umm thats not the fault of the market…lol
It’s entirely the fault of government. Have you looked into what government has done to the health insurance industry? it’s rediculous.
I hate health insurance companies, Health insurance is THE MOST REGULATED industry in the entire united states economy.
That’s odd…why aren’t they doing a good job.
As for your other points about “perfect knowledge” I addressed them in post #61.
If I didn’t, then let me know, this topic is moving very fast.
#59 DA
Oh dear.
‘You imply that EVERYONE needs to be experts to know when they are getting screwed. Thats absurd’
No its certainly not absurd.
Happens all the time. The current economic melt down? DDT? Thalidomide? Bernard madoff? Bovine growth hormone? Mad cow disease? Love canal? The savings and loan fiasco? Smoking?
And that’s just off the top of my head…
The idea you’ll always know when you’re being screwed is just stupid. If you knew then you might do something about it – great point. But generally you don’t.
Hindsight is 20/20.
#49 Named,
Maybe we shouldn’t have corporate personhood then? You know…because corporations AREN’T PEOPLE.
I have to go to work now, when I return later tonight I’m sure this thread will be a million pages long…Wish I could stay.
#59 The dairy farm example is a perfect demonstration of what I describe in #57. Allow dairies to do nasty things, and then wait until enough people are suffering and dying to maybe do something about it. Instead of saying up front, hey, don’t feed your cows stuff that will poison the milk.
Again — what kind of twisted mentality wants that?
#65, Same here. Cheers.
65 DA,
“Maybe we shouldn’t have corporate personhood then? ”
It’s a very nuanced debate actually. LibertyLover made some good points about it previously.
Practically, it’s a pipe dream.
#62 Not simpler. Righter.
So, it’s righter for a certain number of people to die in flaming wrecks before car manufacturers are forced to make safer cars? It’s righter that a certain number of people be poisoned by tainted milk before dairies are forced to make safer milk? It’s righter for a certain number of people to die from insufficiently tested medication before drug companies are forced to make them safer?
You’ve got a pretty damn twisted idea of right there, pal.
#63
‘Umm thats not the fault of the market…lol’
You’ve missed the point. It’s an example of complexity. Complexity bought about by the market. The government doesn’t impose that complexity. And before you say the ‘regulation did’ – it did not. They could make it a page of large type if they wanted to.
The complexity is to the benefit of the company. Offerings of companies are not comparable. It is not apparently in the interests of companies to make it so.
That’s not true of all markets. Some are simpler – like buying a pencil. They pretty much all work. But for lots of other things they are more complicated – and often its not in the interest of companies to make it simple.
The government can impose simplicity. It can say if you want to be in the health insurance market – then these are the things it must have. And they can enforce that (like an individual often can’t for reasons already stated).
LL: Seriously? If a bunch of people owns cars and they start on fire, do you really think they aren’t going to notice?
They’ll be dead. And the family broke and unable to hire a lawyer because the insurance company blamed the driver and the bank called in the loan. No regulations, you see.
And it will be the dead guy’s fault because the car company has better lawyers who are vastly more experienced at this sort of blame game. The little guy almost never wins these cases.
LL, you just don’t understand the reality of what’s going to happen in your world. Essentially, we’re all dead and broke.
#39 Phydeau said, “And another thing, small businesses like regulation because it forces the big guys to play fair.”
Congratulations! The most uninformed ignorant statement in the annuals of this Blog.
We absolutely should not have corporate personhood. But corporations have such control over our government now, that it would be a huge struggle to change it.
My closing response, until way late tonight.
READ my posts again, you don’t understand what I’m saying. You really don’t.
You are only looking at what is seen, you need to also understand what is not seen or at least, what you do not see.
I could EASILY do a better job than health insurance companies, BUT I’m NOT ALLOWED TO COMPETE and yes, THAT IS the fault of government.
If you think that you could do a better job than health insurance companies then go try. Good luck figuring out how to do it legally though. It’ll take you years to figure out all the regulations, taxcode and laws that confuse, restrict, and muddle that industry and prevent it from providing a good service to the consumer.
#72 lol Loupe, well, in their ideal form regulations would force the big guys to play fair. Of course many regulations have been written by the big guys and their lobbyists and thus are very unfair to small businesses. So we weren’t talking in reality, but in theory (where libertarians spend most of their time)
#74–DA==”I could EASILY do a better job than health insurance companies, BUT I’m NOT ALLOWED TO COMPETE and yes, THAT IS the fault of government.” //// It would be amusing to look “behind” what you are saying and see what you mean? Just what do you think the job of an insurance company is?
I understand though. I could be A GREAT SURGEON, hack-whack, I enjoy the look, taste, feel of blood. I enjoy it so much, I’d do it for free. All we need now is some kind of gatekeeper to tell me what to cut out and some kind of after care guy to check for infection==and we are in business. Pesky government regulations interfere with those wanting to play doctor. Consider your own experiences==can’t any of us cut a piece of meat? Surgery==biggest quack regulations in the world.
Demand Free Market Services. Look for the sticker.
#59–DA==”You imply that EVERYONE needs to be experts to know when they are getting screwed. Thats absurd, if I see that everyone is getting sick from a certain companies brocolli then I’m not going to eat their brocolli…” //// Hah, hah.
WoW, MoM, Wow: If we assume you already know what is making you sick, then there is no need to be an expert in anything.
It is rare on the outbreak of good poisoning that the CDC trained experts don’t take weeks to figure out what it is. How many people eat nothing but broccoli over a 3 day period? How often is food poisoning diagnosed as “flue” by experts who have studied medicine for years?
DA==you post with the insight of someone expounding on GUN SAFETY by looking down the barrel while pulling the trigger.
You can’t get more stupid than “most” (not all) of what you post here.
Objectively===very silly. On the verge of being a LIEBERTARIAN!!!!!!!!!
Discussion of this topic is a good example of how the truthful general statement is one of philosophy, valid only in a vacuum. General statements of LIEBERTARIANISM vs SOCIALISM are for fools.
Alternative real world valid PRAGMATIC discussion: pick an issue ((as one might pick broccoli)) and discuss what regulations are appropriate or not to achieve what end?
#59–DA (joining us later after a full day of work)==”if I see that everyone is getting sick from a certain companies brocolli then I’m not going to eat their brocolli…” /// From the last brocolli outbreak, it turns out there are about 10-12 major growers of broccoli ((more from Mexico and Peru?)) that find its way into 856 different “name” brands. You can’t even find out who grew the broccoli without “source regulations” and “source labeling and tracking regulations.”
Even if you magically know all these things that actually true experts don’t know, you still can’t protect yourself without regulations to back yourself up.
SILLY BEYOND RATIONALE BELIEF!!!! you are!
Look for the “Regulation Free” product sticker.
Regulations give us control/recourse WHEN they screw up..
regulations against OVER charging..
regulations on OVER drafts..
regulations on WHO is told BEFORE stocks go up..
REGULATIONS give the consumer a chance in court if they SCREW you.
Banks/credit cards/insurance are the ONLY business models that are ALLOWED to change a contract ANY TIME they wish.