Elizabeth Warren On Consumer Financial Protection Agency (VIDEO)
Elizabeth Warren, the chair of the Congressional Oversight Panel and a professor at Harvard, has been on a mini-media blitz of late. Yesterday, she released a YouTube video supporting President Obama's Consumer Financial Product Agency. Today, the Baseline Scenario has a guest post from Warren in which she describes three myths surrounding the proposed agency.
The Consumer Financial Product Protection Agency would shield consumers against exotic mortgages and confusing credit card offers. As Warren describes it, creating a new agency would, in fact, simplify the current regulatory structure:
"I believe it will reduce risk in the system and can reduce the overall regulatory burden. That's right, it can actually reduce it. Right now, there are seven federal agencies that have some piece of credit regulation...In place of old, complex regulations, the new agency can encourage and help develop some plain-vanilla products."
Warren has also compiled what she calls "3 Myths About The Consumer Financial Product Agency". Here's her summary:
"At the end of the day, industry lobbyists try hard to invent myths and make things sound confusing to intimidate the public and to keep policymakers from acting. But this issue is simple: keeping safety and soundness and consumer protection together has not ensured safety and soundness, has not protected consumers, has not fostered choice and innovation, and has not minimized regulatory burden. In fact, the current regulatory structure that combines consumer protection with other bank oversight responsibilities has led to the kind of bad regulatory oversight that has led us to this crisis. The CFPA would put someone in Washington--someone with real power--who cares about customers. "