“Thus an idea that the U.S. banking industry has learned to hate moved a giant step closer to reality. The creation of a consumer protection agency is part of the Obama administration’s plans to enact the most wide-ranging financial regulations since the Great Depression.
Following the 1999 decision to overturn the Glass-Steagall Act that separated commercial banks from securities firms, bank lobbyists have been able to shoot down virtually any proposed rule they perceived as unfavorable to their industry, lobbyists and politicians say . . .
Banks and securities firms spent $193 million to fund political campaigns for the 2008 elections and raise even more money through events that their trade groups organize. They have successfully fought the administration’s efforts to limit executive pay and are battling against draft legislation governing the $592 trillion market for derivatives.
When it comes to consumer banking, the industry’s lobbyists are no longer all-powerful. Banks lost their bid to squelch new credit card rules that Obama signed into law in May. They lobbied for months before a bill that would have forced them to renegotiate mortgages failed in the Senate.
Now the banks and their trade associations are lobbying furiously to kill Obama’s plan to create the new financial protection agency, which was approved by the House Financial Services Committee in late October and is likely to face a full House vote by the end of 2009.
Read the full piece . . .
Banks Discover Consumer Protection Too Big to Fail
Bloomberg, Nov. 3 2009