In this week’s address, the President highlighted the progress made protecting American consumers since he signed Wall Street reform into law five years ago, including an important new step taken by the independent Consumer Financial Protection Bureau earlier this week toward preventing abuses in payday lending.
The President emphasized his commitment to fighting to advance middle-class economics and ensure everybody who works hard can get ahead, while opposing attempts by Republicans both to weaken the CFPB and give large tax breaks to the wealthiest Americans at the expense of the middle class.
President Obama spoke yesterday in Birmingham Alabama at Lawson State Community College. He mentioned that Congress passed a bill (insert shock emoticon here) but that they also released their budget. That budget gifts the richest Americans at the expense of middle and low income workers.
The emphasis of the speech was new rules to be issued by the Consumer Financial Protection Bureau (CFPB) which will protect consumers from abusive payday lending practices.
We were hearing a story from some of the advocates who were working here in Alabama, a story about a family — the grandmother died, matriarch of the family. She passed away. They don’t have quite enough to pay for the funeral. They go to a payday loan, borrow for the funeral; can’t pay back the loan in time; the family’s car gets taken away. And the two folks who are the breadwinners in that family lose their jobs because they can’t get to work. Right? So what started off as a short-term emergency suddenly becomes a catastrophic financial situation for that family.
And you don’t need to be a math genius to know that it’s a pretty bad deal if you’re borrowing $500 and you have to pay back $1,000 in interest. […]
The Consumer Finance Protection Bureau, the CFPB, announced today that it’s going to take important steps towards protecting consumers from getting stuck into these cycles of debt. (Applause.)
And the idea is pretty common sense: If you lend out money, you have to first make sure that the borrower can afford to pay it back. Don’t lend somebody money if you know they can’t pay it back.
As Americans, we don’t mind seeing folks make a profit. And if somebody lends you money, then we expect you to charge interest on that loan. But if you’re making that profit by trapping hardworking Americans into a vicious cycle of debt, you got to find a new business model. You got to find a new way of doing business. (Applause.)
He expressed his hope that Congress would support his initiatives and he left his audience with this:
We’re also a country that was built on the idea that everybody gets a fair shot and that we put laws in place to make sure that folks aren’t taken advantage of. When this country does not live up to its promise of fairness and opportunity for all people, we’re all hurt. (Applause.) When we do live up to those promises, all of us are better off.
Back in 2008, I came to Birmingham as a candidate for this office, and I said, “There is nothing we cannot do if the American people decide it’s time.” Seven years later, I still believe there is nothing we cannot do if we decide it is time. (Applause.) We’re all in this thing together, Alabama. We’ve been through some tough times together, but we’re coming back together. If we decide this is our time, then together we’re going to write the next great chapter in this country’s history.
Congress did pass a bill and we can all applaud that. But the American people need to stand up and say “it’s time — time to cast aside the party of the have-mores and embrace living wages for everyone who wants to work hard”.
In this week’s address, President Obama discusses the Senate’s confirmation of Rich Cordray as Director of the Consumer Financial Protection Bureau. The CFPB is an independent watchdog set up to protect families from irresponsible behavior in the financial sector – one that puts mortgage lenders, student lenders, payday lenders, and credit reporting and debt collection agencies under greater scrutiny, while providing the American people a place to get some measure of justice if they don’t play by the rules.
