Mr. Goolsbee: Hi, I'm Austin Goolsbee from the Council of Economic Advisers.
And I don't need to tell anybody that this has been the worst
financial crisis since 1929.
Millions of people had their retirement savings cut in half.
They have seen all throughout the financial system real trauma
and the impact that that's had on the economy.
Millions of people have lost their jobs.
It is imperative that we never allow that to happen again.
And that's why the President has launched a major effort to
reform the financial regulatory system and set the rules of the
road so that we don't get back into an environment where
financial institutions have snuck off the road,
are doing things they should not have engaged in.
On mortgages, on credit cards, on consumer ratings,
on payday lenders, and a whole bunch of areas,
some people in the financial industry were above board and
were behaving correctly.
Some people were engaging in behaviors that were not fair,
that were misleading.
They weren't using clear language.
They were doing a number of things that put consumers at
risk, and in the end contributed to bringing down the wide parts
of the financial system.
Consumers must be responsible too.
But what you've seen over the last several years are some
credit card, some credit card companies engaging in things
like setting due date of your bill to be at 9 a.m.
so that if the mail comes after lunch you get a late fee because
you didn't pay on time.
Taking your bills, if you have two different balances,
one with a high interest rate and one with a low interest
rate, they will apply your payment to the low interest rate
one leaving you the balance where you have to pay more.
Applying penalties on things after the fact.
After you already took the loan, raising the interest rate on
money you already took out.
A series of practices that have bordered on deceptive,
and in some cases, gone over that border.
On mortgages is another area requiring plain language.
If you've ever bought a house you know you have hundreds of
forms from many different agencies.
It's really hard to tell what the rules are,
what is happening, what are you signing.
The key themes of the President's regulatory reform
effort are transparency, accountability, and fairness.
And one of the most important places where we are going to
apply those principles is protecting consumers and really
re-establishing rules of the road as they apply
to you and your family.
The President wants to streamline and create a new
agency centered on consumer protection in
the financial products area.
It would take the consumer protection authority out of
seven different agencies and consolidate it into one
accountable agency that will enforce a level playing field
that applies to everyone.
So that there is a streamline accountable process within the
government that anyone can go to,
and we know that person is trying to protect consumers is
really important.
This isn't about bigger government.
It's not about over regulation.
It is about streamlining the rules of the road and creating a
clear accountable government office that is going to make
sure that these kind of shenanigans,
never get us to a situation where they can bring down the
economy because somebody went too far and went to
the extremes again.
