Sen. King urged to reconsider Wall Street deregulation

Sen. King urged to reconsider Wall Street deregulation

Yesterday members of the Maine People’s Alliance delivered more than 1,000 petition signatures to the office of Senator Angus King urging him to reconsider his support for a package of bills that could weaken and delay federal consumer protections. The so-called “regulatory reform” bills would throw sand into the gears of federal regulators – potentially affecting everything from women’s health to food safety, financial reform, and the environment – by adding more hurdles and requirements to an already laborious rulemaking process.

The bills in the package range from giving the Congressional Budget Office the power to review and veto proposed rules (S.1607), to blocking regulations passed at the end of a Presidential term (S.2006), to requiring additional, unnecessary steps in the rulemaking process (S.1820). The cumulative impact of the package of bills would be to paralyze the regulatory process and rig the system in favor of deregulation.

“It’s extremely disconcerting to hear that Senator King is considering supporting a package of bills that would undermine the independent authority of agencies like the Consumer Financial Protection Bureau and tip the balance away from consumers and back to Wall Street,” said Andrew Francis of the Maine People’s Alliance. “I think that if the response that we’ve heard from Mainers in the last two days is any indication, Senator King is on the wrong side of this issue.”

Last month the New York Times editorialized against the regulatory reform package writing that “the winners would be big banks and big businesses. The losers would be ordinary Americans who would be deprived of timely and effective protection from the Consumer Financial Protection Bureau and other bank regulators, as well as from agencies that oversee consumer product safety, nuclear safety, investor safeguards, workplace rights and a host of other issues and activities.”

The proposed package comes as the Consumer Financial Protection Bureau (CFPB) is considering a landmark rule to reign in the worst practices of the payday loan industry.

Last year, predatory lenders across America raked in over $10 billion by trapping millions of people in short-term, high interest payday loans. These lenders market payday loans as a quick financial fix for people working minimum wage jobs that have nowhere else to turn for help. But with interest rates as high as 300%, many borrowers became trapped in a cycle of debt, owing more of each week’s paycheck to Wall Street lenders

Elements of this package could have serious impacts on the CFPB’s rulemaking process by pressuring the agency to reconsider or weaken the rules and allowing the payday loan industry to suit in Federal court to grind the process to a halt.

“It’s taken years for the CFPB to get to the point of even proposing a rule and being forced to turn back now because of legislation passed by Congress would be devastating to millions of Americans trapped in a predatory cycle of indebtedness to Wall Street,” said Carissa Tinker, an MPA member from Portland who participated in the delivery. “Senator King should listen to his constituents on this matter and support Mainers over Wall Street.”

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