Sen. Alexander on Consumer Agency: ‘Another Washington Takeover’

May 6, 2010 2:06pm

ABC News’ Rick Klein reports: Senate Republicans are seeking to refashion the Consumer Financial Protection Agency included in Democrats’ financial regulatory reform bill – drawing harsh words, if not quite a veto threat, from the White House. On ABC’s “Top Line” today, Sen. Lamar Alexander, R-Tenn., called the proposed agency’s structure the “biggest problem” in the bill drafted by Senate Banking Chairman Chris Dodd, D-Conn. “It’s just what we’re getting accustomed to in the United States: another Washington takeover and another czar or czarina,” Alexander told us. “The Washington takeover this time is of Main Street lending, because it would I mean it’d be the end, for example, of paying your daughter’s dentist bill over 18 months. “What’s this all about? I mean, we’re supposed to be dealing with big banks and financial shenanigans on Wall Street, not taking over Main Street lending. So the Republican proposal is get rid of the section on Main Street lending, leave it with the regulators that are there today, put the czarina under someone’s accountability — either the president or Congress or both. Make those two fixes, then we can have a good consumer protection agency.” The proposed amendment from Sen. Richard Shelby, R-Ala., would house the new agency inside the Federal Deposit Insurance Corporation, instead of within the Federal Reserve, as Democrats want. It would also remove many smaller lenders from the new agency’s purview. As ABC’s Jake Tapper reported today, President Obama issued a statement saying the amendment “will significantly weaken consumer protection oversight,” but the White House stopped short of labeling that a veto threat. Alexander also blasted a proposal from a bipartisan group of senators that would subject the Fed to full congressional audits. The White House also opposes that notion. “It would turn the monetary policy of the United States over to the one group in the world that you wouldn’t want to turn it over to, which is the United States Congress,” Alexander said. “Do you really think that a Congress that is going to triple the federal debt in 10 years ought to be in charge of inflation in the United States of America? The answer is no. “The Fed’s already transparent. There’s provisions in the Republican and Democratic proposals to make it more transparent. But the idea of just getting rid of the Federal Reserve Board and turning it all the way over to the United States Congress would wreck our economy, send a terrible signal to the world.” “What the authors really want to do is get rid of the central bank and go back to the gold standard,” he added. Alexander also applauded the federal response to the massive flooding in home state. “I think they’re doing a good job,” Alexander said. “It’s a disaster in Nashville. A billion dollars [in damage], the mayor says, the Opryland Hotel under 15 feet of water. But FEMA’s on the ground. We have no complaints so far. One thing I want to do after we help people get back on their feet is examine the question of whether the Army Corps of Engineers gave the correct, clear and consistent information to the people of Nashville and to businesses about the rising water and the discharge of flood water. But right now we’re trying to help people get back on their feet.” Watch the interview with Sen. Lamar Alexander HERE.

We also checked in with Taegan Goddard of Political Wire on the politics of financial regulatory reform. Watch that portion of “Top Line” HERE.

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