Winners ‘N Losers

by digby

Here’s a box score type article in Politico about the “winners and losers” in the Consumer Financial Protection Agency vote. Here’s how it’s characterized:

The U.S. Chamber of Commerce and Wall Street are on the outs, and consumer advocates and cranky liberals are in. Some moderates are getting left in the dust, while special interests that play on parochial loyalties still remain powerful.

I guess the public isn’t in the game …

But on the whole, that sounds like a pretty good score to me. I don’t even mind being called cranky liberal. I think it’s a good thing for the liberals to be cranky when it comes to financial reform and consumer protection. Any politician who isn’t cranky isn’t paying attention or isn’t doing his or her job.

One caveat in all this is that the automobile dealers seem to have gotten quite the sweetheart deal, presumably because they are in one of the still desperate industries. But as Dday reports, it’s a bad idea on the merits, and a bad idea pushed by a crook (and a nut) to boot:

The auto dealer exemption is probably the worst amendment in the entire Financial Services Committee markup on regulatory reform. You can make a case for some of the other amendments, and Rep. Frank said on Rachel Maddow’s show last night that the committee will pass the reform bill today that gives Democrats and the Administration “90% of what we wanted.” But this is part of that other 10%. Auto financing is typically the second-largest purchase a family makes, behind housing, and the horror stories of auto loan customers being ripped off are voluminous. The amendment was authored by Rep. John Campbell (R-CA), a former auto dealer who has been ripped by consumer groups for having major conflicts of interests.

The consumer groups, which also include organizations that want election reform, say that Campbell should walk away from his amendment for two reasons. First, because six auto dealerships pay him rent and would benefit from his amendment and he would benefit. And second, that Campbell received $170,000 in campaign contributions from auto dealers since he’s run for Congress. The groups say Campbell’s personal financial disclosure forms show he received between $600,000 and $6 million in rent last year.

Campbell’s “defense” is that four of the six properties are no longer car dealers, having gone out of business – so two still are, and the amendment will directly shield them from oversight. He also says that the House Ethics Committee approved him authoring the amendment, without giving details. It turns out that Campbell recused himself from a vote last year on bailing out the automakers, based on a conflict of interest, but in this case, writing the amendment exempting them from oversight is OK with him.

So, it’s not perfect. Auto loan contracts are among the most common entered into by individuals and they constitute one of their largest investments. Leaving them without oversight is a recipe for taking Joe and Jane American to the cleaners. The lesson that everyone needs to grok is that we are in the era of the rip-off, where if you leave the loophole, they will run over each other to get through it.

Still, I’m quite pleased that the cranky liberals and consumer protection advocates actually won one for the team (the team being the citizens) even if it’s imperfect. Considering what has happened, this should be an era of consumer protections and financial reform unequaled since the 1930s. It’s good to see some action on this front finally. Let’s hope that’s just the beginning.

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