When the Senate recently passed the banking reform bill, "Restoring American Financial Stability Act of 2010" (S. 3217), it included a strong combination of improvements to our financial system. That bill had overcome some major hurdles, not the least of which is a penchant for legislative inertia in an election year and paralyzing partisanship. Consumers made thousands of calls, sent letters, and made visits. Some lawmakers in Congress, a body that can't possibly get lower approval ratings, truly rose to the occasion. This week with the House and Senate lawmakers working to combine their bills into one, it is more important than ever that our leaders stand tall.
If we're not careful, our hard work and victories to this point could all be undone. Conversely, banking reform presents a real opportunity to show how business in Washington has changed. President Obama and his administration have been steadfast in fighting for good financial reform policies and a new system that has consumers in mind -- all consumers, not simply those who invest large sums of money. The new law would, for instance, include a new federal agency entirely devoted to defending consumers against abusive financial products.
Representative Gutierrez (D-IL, 4th) and Senator Menendez (D-NJ) spearheaded the expansion of the Financial Education and Counseling program that provides free financial advice to families. This legislation also includes new protections against industry players that steer families into predatory mortgages, championed by Representative Watt (D-NC, 12th) and Senator Reed (D-RI).
Representative Waters (D-CA, 35th) also secured substantial funding to aid unemployed homeowners and stabilize neighborhoods hard hit by the great recession. As an illustration of the law's inclusiveness, Representative Gutierrez and Senator Akaka (D-HI) established disclosures that create a more transparent process for wiring money abroad.
As the bill is finalized, and industry pressure for backroom deals intensifies, we will need our champions to work harder to hold the line. Banking reform must:
- Establish a new agency, the Consumer Financial Protection Bureau (CFPB), dedicated to tracking emerging trends of financial abuse and enforcing consumer protection laws.
- Stop auto dealers in their search for a loophole or the means to escape accountability to the public and consumers.
- Provide expanded access to independent financial advice so that families will receive real-time guidance on how to get back on their feet financially.
- Promote access to safe and affordable bank accounts and credit, rather than fringe financial products, for low-income, minority, and underbanked families.
- Include new disclosures that would display the true cost of remittances and their received value.
The National Council of La Raza (NCLR) will continue to monitor these and other priorities throughout the process. We are encouraged by the leadership that the president has shown on this issue and the hard work of our champions in Congress. Now is the time to be steadfast and unrelenting--how you finish now matters more than how well you fought.