Banking Law

When I read this interview with Elizabeth Warren last week, I saved it for a later "fisking," but before I even got started, Anthony Demangone at NAFCU Compliance Blog beat me to it with a "Whoah, Nelly" summation that cut to the heart of what Ms. Warren's all about: "credit cards are bad."

Anthony also analyzes some comments of Ms. Warren that were put out by the US Treasury Department in the form of a question and answer session. Again, Ms. Warren's observations offer insight into her agenda and what banks and other financial institutions can expect from the CFPB as long as she's in charge of it whether de facto or de jure). In addition, Anthony's self-confessed "snark" happens to resonate with this purveyor of the same. Among my favorites:

Man, she hates credit cards. Forget payday lenders, fly-by-night "credit repair companies, and auto-title loan companies.  Credit cards are front and center on her agenda.

In the words of my man Snoop Dog: "Fo shizzle."

One more point made by Anthony that touches on a tune I've long been singing: We agree with Ms. Warren's desire to have "clear" disclosures so that consumers (which even we minions of the Dark Side of The Force happen to be) can make "apples-to-apples" comparisons of consumer loan products. People like the OCC's Julie Williams and this pathetic blogger have been yakking about that need for years. As Anthony also notes, however, this is a task that's easier said than done.

Keep in mind that many regulators have gone before you with this same task in hand. The Federal Reserve has spent a good deal of time on consumer issues and consumer testing of financial disclosures. No matter how much work you throw into this, keep in mind that you'll run into one basic problem: many consumers simply do not attempt to read disclosures. I agree that some credit card agreements are complex, but the Schumer Box gives consumer more than enough information to compare credit card products. And to say that the mortgage problems we face today are due to poor disclosures while not talking about broker misrepresentations, predatory lenders, and consumer responsibility is simply not telling the whole story. 

There aren't many people in D.C. of any political persuasion who are interested in "telling the whole story." You'd have a better chance of finding a Marxist on Fox News or a disciple of Russell Kirk on MSNBC. Ms. Warren has an agenda and her narrative serves the agenda. Spreading the responsibility for the consumer credit mess we're equally among the participants does not serve the agenda of building another large federal bureaucracy to protect us from ourselves. "The whole story" will have to be pieced together from other sources.