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Consumer organization blasts House Appropriations Committee on recent vote; fear return to policies that allowed predatory lending

Dennis Norman St LouisThis week, in response to the House Appropriations committee voting to slash funding for the newly formed Consumer Financial Protection Bureau (CFPB) and to subject the new agency to a “politically-charged” funding process, Mike Calhoun, President of the Center for Responsible Lending, made the following comment: “the House Appropriations Committee yesterday voted for a return to policies that allowed predatory financial products to plunder our economy. Clearly some lawmakers have forgotten the lesson of today’s financial crisis, which continues at great cost to taxpayers, shareholders, retirees and, of course, tens of millions of families who have needlessly lost their homes or seen them plummet in value.”

Calhoun claims that the financial companies that “created the current recession” and backed this move by the House Appropriations Committee are fighting hard to prevent the Consumer Financial Protection Bureau (CFPB), which won’t be implemented until July, “from ever having a chance to do its job.” I agree with Calhoun’s comment that “a strong, independent CFPB will help restore the economy by promoting a fair, transparent financial market” and “weakening the CFPB will lead to more financial abuse, more meltdowns, more taxpayer bailouts.”

The only thing I’ve seen from the CFPB thus far is the beginning of their efforts to change disclosures on home mortgages, making them simpler and easier to understand, which has been impressive so far.

The House Appropriations Committee action is still subject to action by the full House and Senate, so the debate on this topic is far from over.

 

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