_pennystock版 - Warren To Set Up Consumer Financial Protection Bureau |
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b*****h
发帖数: 3386 | 1 The White House has tapped Elizabeth Warren as a special adviser to help set
up the Consumer Financial Protection Bureau, ABC News is reporting. The
move allows her to act as an interim head of the CFPB and will enable her to
begin setting up the agency immediately and prevent the GOP from
filibustering her nomination. Warren could serve until Obama nominates a
permanent director -- a nomination he's not required to make for some time. | b*****h
发帖数: 3386 | 2 Impressed by her article before
Elizabeth Warren
Posted: December 3, 2009 10:00 AM
America Without a Middle Class
Can you imagine an America without a strong middle class? If you can, would
it still be America as we know it?
Today, one in five Americans is unemployed, underemployed or just plain out
of work. One in nine families can't make the minimum payment on their credit
cards. One in eight mortgages is in default or foreclosure. One in eight
Americans is on food stamps. More than 120,000 families are filing for
bankruptcy every month. The economic crisis has wiped more than $5 trillion
from pensions and savings, has left family balance sheets upside down, and
threatens to put ten million homeowners out on the street.
Families have survived the ups and downs of economic booms and busts for a
long time, but the fall-behind during the busts has gotten worse while the
surge-ahead during the booms has stalled out. In the boom of the 1960s, for
example, median family income jumped by 33% (adjusted for inflation). But
the boom of the 2000s resulted in an almost-imperceptible 1.6% increase for
the typical family. While Wall Street executives and others who owned lots
of stock celebrated how good the recovery was for them, middle class
families were left empty-handed.
The crisis facing the middle class started more than a generation ago. Even
as productivity rose, the wages of the average fully-employed male have been
flat since the 1970s.
But core expenses kept going up. By the early 2000s, families were spending
twice as much (adjusted for inflation) on mortgages than they did a
generation ago -- for a house that was, on average, only ten percent bigger
and 25 years older. They also had to pay twice as much to hang on to their
health insurance.
To cope, millions of families put a second parent into the workforce. But
higher housing and medical costs combined with new expenses for child care,
the costs of a second car to get to work and higher taxes combined to
squeeze families even harder. Even with two incomes, they tightened their
belts. Families today spend less than they did a generation ago on food,
clothing, furniture, appliances, and other flexible purchases -- but it hasn
't been enough to save them. Today's families have spent all their income,
have spent all their savings, and have gone into debt to pay for college, to
cover serious medical problems, and just to stay afloat a little while
longer.
Through it all, families never asked for a handout from anyone, especially
Washington. They were left to go on their own, working harder, squeezing
nickels, and taking care of themselves. But their economic boats have been
taking on water for years, and now the crisis has swamped millions of middle
class families.
The contrast with the big banks could not be sharper. While the middle class
has been caught in an economic vise, the financial industry that was
supposed to serve them has prospered at their expense. Consumer banking --
selling debt to middle class families -- has been a gold mine. Boring
banking has given way to creative banking, and the industry has generated
tens of billions of dollars annually in fees made possible by deceptive and
dangerous terms buried in the fine print of opaque, incomprehensible, and
largely unregulated contracts.
And when various forms of this creative banking triggered economic crisis,
the banks went to Washington for a handout. All the while, top executives
kept their jobs and retained their bonuses. Even though the tax dollars that
supported the bailout came largely from middle class families -- from
people already working hard to make ends meet -- the beneficiaries of those
tax dollars are now lobbying Congress to preserve the rules that had let
those huge banks feast off the middle class.
Pundits talk about "populist rage" as a way to trivialize the anger and fear
coursing through the middle class. But they have it wrong. Families
understand with crystalline clarity that the rules they have played by are
not the same rules that govern Wall Street. They understand that no American
family is "too big to fail." They recognize that business models have
shifted and that big banks are pulling out all the stops to squeeze families
and boost revenues. They understand that their economic security is under
assault and that leaving consumer debt effectively unregulated does not work.
Families are ready for change. According to polls, large majorities of
Americans have welcomed the Obama Administration's proposal for a new
Consumer Financial Protection Agency (CFPA). The CFPA would be answerable to
consumers -- not to banks and not to Wall Street. The agency would have the
power to end tricks-and-traps pricing and to start leveling the playing
field so that consumers have the tools they need to compare prices and
manage their money. The response of the big banks has been to swing into
action against the Agency, fighting with all their lobbying might to keep
business-as-usual. They are pulling out all the stops to kill the agency
before it is born. And if those practices crush millions more families, who
cares -- so long as the profits stay high and the bonuses keep coming.
America today has plenty of rich and super-rich. But it has far more
families who did all the right things, but who still have no real security.
Going to college and finding a good job no longer guarantee economic safety.
Paying for a child's education and setting aside enough for a decent
retirement have become distant dreams. Tens of millions of once-secure
middle class families now live paycheck to paycheck, watching as their debts
pile up and worrying about whether a pink slip or a bad diagnosis will send
them hurtling over an economic cliff.
America without a strong middle class? Unthinkable, but the once-solid
foundation is shaking.
Elizabeth Warren is the Leo Gottlieb Professor of Law at Harvard and is
currently the Chair of the Congressional Oversight Panel. |
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