Inquirer Editorial: Debtors need an ally
Since 2006, more than 5.6 million homes have gone into default nationally. The crisis is ravaging middle-class communities like Willingboro, where 2,400 homes have gone into foreclosure since 2005, and there are now more than 700 vacant homes.
Since 2006, more than 5.6 million homes have gone into default nationally. The crisis is ravaging middle-class communities like Willingboro, where 2,400 homes have gone into foreclosure since 2005, and there are now more than 700 vacant homes.
Yet political leaders in Washington, who were slow to react to the crisis, are still debating the launch of a Consumer Financial Protection Bureau, even as it is formally set to begin operations on Thursday.
Millions of families already have endured the anguish of losing their largest investment. And many more who have not had mortgage troubles have helplessly watched home values plummet and the wealth they thought they had slip away.
In reaction to that pain, Congress created the bureau last July to watchdog consumer lending. The new agency would keep a closer eye on mortgage lenders, credit-card companies, and even those who make payday loans. While there are reams of regulations on the topics, there is no single agency to oversee and enforce the rules with consumers' interests in mind.
President Obama Monday selected Richard Cordray to head the new bureau. A former Ohio attorney general, Cordray built his reputation on aggressive prosecution of unscrupulous lenders and has been helping gear up the agency since last December. The president nominated him after House Republicans tangled with Elizabeth Warren, the Harvard law professor who conceived of the agency and who was said to be the front-runner for the job.
But Senate Republicans have signaled they will try to block Cordray's confirmation. They say they don't want a single director, but would rather have a board of trustees oversee the agency.
That question has already been settled, and proper oversight is in place. The agency must report annually to Congress and submit to Government Accountability Office audits every year. Its decisions can be overruled by the Financial Stability Oversight Council.
This latest call for yet another layer of bureaucracy feels like a stall tactic aimed at pleasing the financial industry, one of the largest sources of campaign cash for federal officeholders. Didn't a failure to regulate the industry help get this country into this mess?
Why is it so hard to get the consumers a little protection? The middle class, which has been footing the bill and bearing the brunt of the pain, deserves its own watchdog.
Congress should quit wasting time and move to confirm Cordray so he can get to work.