Democracy Gone Astray

Democracy, being a human construct, needs to be thought of as directionality rather than an object. As such, to understand it requires not so much a description of existing structures and/or other related phenomena but a declaration of intentionality.
This blog aims at creating labeled lists of published infringements of such intentionality, of points in time where democracy strays from its intended directionality. In addition to outright infringements, this blog also collects important contemporary information and/or discussions that impact our socio-political landscape.

All the posts here were published in the electronic media – main-stream as well as fringe, and maintain links to the original texts.

[NOTE: Due to changes I haven't caught on time in the blogging software, all of the 'Original Article' links were nullified between September 11, 2012 and December 11, 2012. My apologies.]

Wednesday, March 01, 2017

Republican congressmen fast-track bill that would repeal consumer protections from overdraft fees

Republicans are moving to scrap consumer protection rules that prevent the prepaid debit card industry from collecting tens of millions of dollars in overdraft fees. The resolution, introduced by Sen. David Perdue, R-Georgia,  would undo the new rules package crafted by the Consumer Financial Protection Bureau (CFPB) in October.

As BuzzFeed notes, Republicans are able to make these major changes with simple majorities thanks to the Congressional Review Act:

    Republicans are now moving to reverse the rules, using a fast-track process enabled by the Congressional Review Act, in which simple majorities in both houses of Congress can eliminate a recently-finalized regulation, with the president’s approval.

Consumer advocates have long called for limitations on overdraft fees, warning that prepaid cards were becoming credit services. Yet a Georgia-based financial company named Total System Services lobbied hard for the repeal of the new rules that barred prepaid card companies from charging overdraft fees. Total System Services owns NetSpend, a prepaid debit card provider that told investors it made roughly $85 million on overdraft fees last year.

Prepaid debit cards are disproportionately used by low-income people.

The Republican argument is that the regulations promulgated by the CFPB were sweeping and would stifle economic growth. Perdue, a former businessman and CEO of Reebok and Dollar General Stores, said at Yahoo’s All Markets Summit that the CFPB had acquired too much authority, calling it a “rogue agency” that does not have any oversight in Congress.

“If the CFPB wants to continue to impose rules and regulations that impact every American’s financial well-being, it must answer to the American people,” Perdue said earlier when the bill was introduced.

The CFPB was created with Dodd-Frank, the financial reform law passed in the wake of the financial crisis. President Trump has pledged to repeal Dodd-Frank, which would eliminate the CFPB. House Minority Leader Nancy Pelosi vowed on Monday to fight to protect the CFPB and the GOP’s attempt to water down consumer protection regulations.

Original Article
Author: Taylor Link

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