The Day

Freeing predators to bilk little people

- Creators Syndicate

The most vivid takeaway from the financial meltdown of 10 years ago was that nearly everyone got hurt. Stock investors took a beating. People who had carefully set aside money for retirement saw a third of their savings vanish. Consumer spending collapsed, pushing two of the Big Three U.S. car companies to the edge of bankruptcy. Unemployme­nt soared to 10 percent.

Taxpayers had to bail out both the banks and the automakers. And no, they didn’t have a choice. It was that or turn the Great Recession into another Great Depression.

The losers were everywhere, but the saddest had to be the ordinary folks who lost their homes. It started with a housing bubble feeding the fantasy that real estate values could only rise. That provided financial predators the perfect setup to peddle indecent mortgage schemes.

The mortgages looked like easy money but were actually booby-trapped contracts loaded with high fees and exploding interest charges. They often transforme­d what could have been manageable setbacks into foreclosur­es.

Out of the rubble rose a government agency tasked with reining in some of the abusive lending practices that fueled the debacle. It is the Consumer Financial Protection Bureau. The CFPB set rules on mortgages, payday loans and other financial products.

Mick Mulvaney is a former congressma­n and best friend forever of Wall Street. He once called the CFPB a “sick, sad” joke. He recently told the American Bankers Associatio­n, “If you’re a lobbyist who never gave us money, I didn’t talk to you.”

Mulvaney is now temporaril­y running the CFPB. His apparent mission is to remove the obstacles between the predators and their little-guy prey. Under him, there has been no new investigat­ing, hiring or data collection. Gone is the online system of consumer complaints that you or I could see. Most cases against payday lenders have been quashed.

Some argue that those who don’t carefully read their contracts, borrow too much or are otherwise ignorant, gullible or greedy deserve what they get. I say that a humane society protects the unsophisti­cated from the financial snakes, some of whom slither behind the biggest names in U.S. banking.

Is it fair to deny credit to people who can’t get traditiona­l loans? The answer is yes. Those with decent credit can borrow at decent terms. Those without such credit shouldn’t borrow.

Even good regulation­s can’t stop a determined fool from being parted with his money. But was it unreasonab­le for the CFPB to go after lenders charging what amounted to an annual rate of nearly 400 percent on a $350 loan? That’s what some payday lenders were draining from threadbare workers.

Ten years after the most recent financial meltdown and the old bad policies are back. Wall Street is getting richer, and the public is on the hook.

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