Taylor: Establish Meaningful Consumer Protections
Posted by Matthew Brian Hersh on March 15, 2010
When Sen. Christopher Dodd (D-Conn.) last week announced that he would move forward with a consumer protection bill without seeking Republican support on the Senate Banking Committee, there was a tentative sense of progress in the room of housing advocates and practitioners attending the annual National Community Reinvestment Coalition conference in Washington, DC. People were hopeful that a new bill with “teeth” would trump the existing political compromise of a Consumer Financial Protection Agency (CFPA) housed at the Fed or Treasury, and replace that with an agency that had independent regulatory oversight preferably one with enforcement power.
But that independent agency is not part of the version of the Dodd bill that was handed down today, where a new CFPA—a consumer financial products regulator—would be housed at the Federal Reserve, amid the protests of many Democrats who have argued for a free-standing agency saying the Fed had the power to regulate financial products for years, but failed to do so. Housing the agency at the Fed appears to be an effort to get Republicans on board who have opposed an independent CFPA. Nonetheless, The Washington Post reports that the Dodd bill represents “the biggest overhaul of regulations since the New Deal.”
But for supporters of an ambitious overhaul once proposed by President Obama, the Dodd bill is something of an anticlimactic letdown. Yes, any Consumer Protection Financial Agency is good on paper, but will housing it within the Fed render it toothless? NCRC’s John Taylor, who made use of a conference luncheon to conduct an impromptu phone bank last week at NCRC’s convention, flooding the Congressional switchboard with calls in support of an independent CFPA, is not pleased:
“Putting the CFPA at the Federal Reserve, as has been proposed, will be more of a waste of taxpayers’ money because we’ll have to pay for the appearance of protection without getting any. Had the Fed exercised their authority and enforced consumer protections, they could have nipped the foreclosure crisis in the bud. Now to turn over consumer protections to the very people who allowed the abuses to happen is simply beyond belief.”
Taylor wrote on CFPA and Community Reinvestment Act modernization in the most recent issue of Shelterforce. We’ll have more response and analysis on the Dodd bill over the next several days.
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Invest In Your Values
Posted by Matthew Brian Hersh on March 12, 2010
In a panel discussion at the National Community Reinvestment Coalition’s 2010 National Convention assessing the administration’s mortgage modification initiatives, Gordon Whitman, director of public policy and communications for PICO National Network pointed to as-yet-hesitance of the bigger banks to establish permanent modifications, and encouraged people to “look at their money,” and if it’s the right place to have their money.
“We need to be thoughtful about putting our money into financial institutions that are going to act in responsible ways in our communities.”
Related to that, Whitman expressed a hope to create a “revolution in local government policy” where localities see lending criteria—i.e. sustainable modification rates, a willingness to extend credit to low-income communities and small businesses—as critical to where local governments put their money.
Specifically, Whitman pointed the the PICO/SEIU victory last week when the Los Angeles City Council established an request for proposal process that will determine where the city puts its money, which is currently housed by Bank of America. The move, according to a PICO statement, could save the city and its residents up to $10 million by way of “preventing foreclosures and ending toxic financial deals” and will “probably” result in the city pulling its money from Bank of America.
“We are hoping to see hundreds of local and state governments pass ordinances and laws that move their money—and not just moving the money big to small, but moving it from irresponsible to responsible.
“Homeowners are losing their homes, communities have been devastated, local governments are facing enormous budget crises driven by, in part, by the financial crisis.”
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A New Turn for the Consumer Financial Protection Bill
Posted by Matthew Brian Hersh on March 11, 2010
At about noon today, NCRC President and CEO John Taylor announced to attendees of his organization’s annual conference that the bipartisan attempt at crafting a Consumer Protection Financial Agency that would regulate mortgages and credit cards had stalled, and that Sen. Chris Dodd (D-Conn.) chairman of the Senate Banking Committee, would begin to piece together a bill without GOP input.
The bad news, Taylor said, was that the talks had stalled. The good news, he added, was that Democrats would go it alone. The reason for this was not knock against bipartisanship, but because many on the right have supported that any regulatory agency be housed in an existing arena: be it the Federal Reserve or Treasury, and how much regulatory power it should have. Revised legislation from Dodd will likely stipulate an independent overseer of a CFPA with wide-ranging regulatory powers.
According to The New York Times:
While the two parties have agreed to create some form of a consumer financial protection agency, they have not agreed on where to house it, or, more importantly, how much authority it should have to write and enforce rules curbing abusive, unfair and deceptive practices.
CFPA, as Dodd has proposed it, “could increase regulatory oversight and enforcement of CRA and other critically important consumer laws,” Taylor wrote in a recent article in Shelterforce, and today he led a roomful of housing advocates in an impromptu phone banking session to senators to encourage the formation of a CFPA with independent oversight. Taylor has long supported Dodd’s bill over the companion bill in the House, coming out of the Housing Financial Services Committee, which Taylor contends takes oversight away from the agency and in the hands of “the same regulators who had failed to enforce it for many years,” rendering it toothless.
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CRA Bill Getting a Hearing
Posted by Matthew Brian Hersh on March 11, 2010
Dion Spencer, NCRC’s director of legislation and regulatory policy just announced that a new Consumer Reinvestment Act bill will be heard by the House Financial Services Committee, citing information from Rep. Luis Gutierrez (D-Ill.). Spencer said that Gutierrez would sponsor new legislation to be heard in the committee as well.
The bill would “give some teeth” to the current HR 1479, sponsored by Rep. Eddie Bernice Johnson (D-Texas), Spencer said, encouraging the crowd here at the NCRC 2010 National Convention to call their legislators.
NCRC’s John Taylor wrote a piece in the most recent issue of Shelterforce urging the passage of a CRA modernization bill.
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Trasviña Hints at a Fairer Housing Act; Principal Reduction in Store?
Posted by Matthew Brian Hersh on March 11, 2010
John Trasvina, HUD Assistant Secretary for Fair Housing and Equal Opportunity, emphasized HUD and Treasurys central role the federal response to the housing crisis, this morning, as well as hinting at further tacks taken by the administration as it continues to address a crisis with as yet elusive solutions
Trasvina offered his remarks to roughly 250 housing advocates at the National Community Reinvestments Coalitions 2010 National Convention, taking place this week in Washington, DC., while echoing an agency-wide message of reviving the agencys relevance. “Its my job to make sure the office relevant in 2010 and to the needs and concerns of people across the country,” he said.
Specifically, the assistant secretary pointed to the 1968 passage of the Fair Housing Act following the assassination of Dr. Martin Luther King, Jr., suggesting that the Act was not only necessary policy, but one that promoted national solidarity. “We have to make sure we are accessible to everyone, and we have to be a gateway to those who are marginalized.”
Part of that access is making the Fair Housing Act “relevant to the 21st century,” including for members of the lesbian, gay, bisexual, and transgender community. Congress has begun what is expected to a be series of hearings on the Fair Housing Act that will consider whether changes to the law are necessary, as well as considering an expansion of the law to include LGBT people. After ENDA, expansion of the Fair Housing Act would only be the second effort of Congress to include the LGBT community in the countrys civil rights laws.
“People are hiding behind their identies to buy a house,” Trasvina said, adding that HUD is currently conducting a housing discrimination study—conducted once every 10 years.
Principal Reduction?
Trasvina also gave a glimpse of more action taken by HUD and Treasury in responding to the foreclosure crisis. In response to a question posed by Phyllis Salowe-Kaye of New Jersey Citizen Action about the administrations recently announced short-sale program within Making Home Affordable, where the servicing bank receives a subsidy to assist a family in danger of foreclosure with relocation assistance, Trasvina appeared to suggest the administration is considering encouraging banks to engage in mortgage principal reduction—a move long supported by housing advocates, despite a cool response from the administration so far.
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NCRC’s Keys From the Crisis Initiative
Posted by Matthew Brian Hersh on March 11, 2010
Stories and pictures of the Great Depression were what finally got people to mobilize into action in the 30s, and NCRC is taking a similar approach to the foreclosure crisis, said Ed Gorman, NCRC’s chief membership and workforce officer. “A home saved is what we’re trying to get done.” The initiative is an interesting concept that tries to establish a visual element that tells a story, visually represents the families impacted, and illustrates the foreclosure crisis.
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Day 2 at NCRC’s 2010 National Convention
Posted by Matthew Brian Hersh on March 11, 2010
It’s the second full day of the National Community Reinvestment Coalition’s 2010 National Conference and people are already assembling to hear morning remarks offered by John Trasvia, HUD’s assistant secretary for Fair Housing & Equal Opportunity. Trasvina was a last minute addition to today’s lineup, which includes luncheon keynote speaker Sen. Al Franken (D-Minn.) and myriad panels addressing issues like sustainable jobs, the affordable homeownership market, powering LMI economies, the future of Fannie, Freddie, Ginnie, and FHLBs.
Stay tuned throughout the say for updates, as well as live updates on Facebook and Twitter (Shelterforce).
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Going Where the Big Boats Are
Posted by Matthew Brian Hersh on March 10, 2010
U.S. Rep. Elijah Cummings (D-Md.) went a bit off script today at that NCRC 2010 National Conference when, after a emphasizing responsive, empathetic government promoting an agenda around social justice, he became more reflective, first recalling his own rental eviction as a college undergrad, and then tacking toward a more uplifting message, using his native Baltimore’s Inner Harbor as background.
The seven term Democrat recalled an address made by the Rev. Jesse Jackson, who urged his audience to go “where the big boats are.”
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Getting Through the Storm
Posted by Matthew Brian Hersh on March 10, 2010
U.S. Rep. Elijah E. Cummings, (D-Md.) offered a sobering, but empowering assessment of the state of the U.S. economy and the impact on families and neighborhood throughout the ongoing housing and employment crises. Cummings’ remarks preceded the luncheon remarks from HUD Assistant Secretary Mercedes Marquez on this first day of the NCRC 2010 National Conference:
“This is America: we’ll get through the storm. But when the storm is over, who will be living in your house? Who will have your job?”
“The little people didn’t cause this problem,” the Maryland Democrat said, “the big folks did, and a log of people got a chunk of change” as a result. Cummings then pointed to culture of “fraud, greed, and dishonesty” in the financial system. His address, rooted in housing and community development, took a wider turn toward a government’s role in advancing social justice, including health care reform, asking the the roomful of advocates and practitioners to push Congress. “It’s not enough to know policy. We need empathy.”
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Live Blogging From NCRC 2010 Conference
Posted by Rooflines on March 10, 2010
Rooflines will be live blogging from the National Community Reinvestment Coalition’s 2010 National Conference beginning Wednesday, March 10. Join us here at Rooflines as we cover this important annual event that features a host of panels on topics that include financial protection, financial investment in your neighborhoods, strategies to influence elected officials, understanding refinance and mortgage modification, green jobs, and much, much more. In addition to many noted figures in the community development field, the list of featured speakers includes Sen. Al Franken (D-Minn.), who will offer the keynote at Thursday’s Congressional Luncheon.
Stay tuned!
National Housing Institute
