Butchers offer financial services? “Completely false,” says Obama
President Barack Obama started his day by learning he had won the Nobel Peace Prize, but that didn’t stop him from quickly turning downright prickly.
After a meeting with Americans who had been ripped off by the financial system, Obama on Friday said big banks and the U.S. Chamber of Commerce were trying to block some of his efforts at financial regulatory reform.
The proposed agency would help ordinary people who borrow money for homes or other purposes, he told an East Room gathering at the White House.
It would get rid of those “ridiculously confusing contracts” that govern everything from credit cards to home mortgages.
“A lot of the banks and big financial firms don’t like the idea of a consumer agency very much,” Obama said. “In fact, the U.S. Chamber of Commerce is spending millions on an ad campaign to kill it.”
It was the ads that aggravated him.
“You might have seen some of these ads — the ones that claim that local butchers and other small businesses somehow will be harmed by this agency,” he said. “This is, of course, completely false.”
“We’ve made clear that only businesses that offer financial services would be affected by this agency. I don’t know how many of your butchers are offering financial services,” the president added.
And he said big banks were trying to maximize “their profits at the expense of American consumers, despite the fact that recently a whole bunch of those same American consumers bailed them out as a consequence of the bad decisions that they made.”
The Chamber of Commerce, seeing the attack coming, put out a note in advance saying they completely agree that consumers need protection.
They just don’t think a big new federal agency should be created to provide the protection.
Instead, the Chamber favors leaving consumer protection to the six federal regulators already doing the job. Their powers could be beefed up so they could become even more effective, it said.
And that ad about the local butcher?
The Chamber says a Consumer Financial Protection Agency would have sweeping authority over virtually every business that extends credit to American consumers.
So if the local butcher lets his customers pay him tomorrow for hamburger meat today, he might be seen as offering financial services and his books could be open to federal scrutiny.
The agency would “have the ability to collect information about his customers’ financial accounts and take away many of their financial choices,” the Chamber’s ad says.
What do you think? Does that ring true?
Photo credit: Reuters/Jason Reed (Obama makes remarks on financial regulatory reform Oct. 9 in the East Room of the White House)