Consumer Law & Policy Blog

Meanwhile … Congress works on legislation to inhibit federal safety standards

In an op-ed in The Hill, former Rep. Steve Israel (D-N.Y.) explains:

While President Trump has kept the public busy with his latest theories about President Obama’s wire-taps, the “deep state” and Arnold Schwarzenegger’s ratings, the Republican Congress has been quietly pushing forward a legislative agenda that will have an all too real impact on the public. The President's tweets are dangerously distracting us from a flurry of new laws passed by Congress to inhibit federal safety standards for everything from hamburgers to helicopters.

This week a Senate committee will consider several bills under the auspices of “regulatory reform.” Who cares about regulation? Well, the next time droves of people are sent to the hospital because of bacteria-laden lettuce, or there are engine problems on the Airbus you're flying, or you’re victimized by a creative credit card scam, you will.

The House has already passed a slew of these bills and the Senate is now quietly taking them up. One bill would enable Congress overturn regulations en masse, a top priority for the Koch Brother’s network, thus allowing Congress to do away with multiple protections without public scrutiny. Already on the chopping block are environmental protections, financial reforms limiting Wall Street excess, and sick leave for workers at federal contractors, among others. Another bill, the Regulatory Accountability Act would impose new hurdles to regulations meant to protect public health, like the Clean Air Act, requiring regulators to prioritize cost over human health.

That is just the start.

The full op-ed is here.

ABA Journal: Trump budget eliminates Legal Services Corp. funding

Here. Excerpt:

 

The American Bar Association is “outraged” that the Trump administration is calling to eliminate funding for the LSC and is calling upon members of Congress to restore it, ABA President Linda Klein said in a statement Thursday. Klein noted that LSC offices are in every congressional district and help 1.9 million people annually.

“Some of the worthy services the LSC provides include securing housing for veterans, protecting seniors from scams, delivering legal services to rural areas, protecting victims of domestic abuse and helping disaster survivors,” Klein wrote. “More than 30 cost-benefit studies all show that legal aid delivers far more in benefits than it costs,” Klein wrote. * * *

Also supporting the LSC are the heads of more than 150 U.S. law firms, who told Trump in a letter that eliminating funding would hamper their ability to provide pro bono representation because they partner with legal aid groups receiving LSC funding.

 

Center for American Progress: Senators Must Ask Gorsuch If He Will Force Americans into Arbitration

Here.  The essay reviews Judge Gorsuch's arbitration decisions. Here's an excerpt:

Senators must press Judge Gorsuch on arbitration during his hearing next week. If he does believe that limits on the FAA’s “heavy hand” exist [as Judge Gorsuch indicated in an opinion], he should be willing to define and describe them. Otherwise, more and more Americans will find themselves unfairly locked out of the courthouse by companies that would rather sweep abuses under the rug than face a judge and jury.

Bloomberg's Chris Bruce: U.S. Set to Signal Stance in Landmark CFPB Powers Case

Here. Excerpt:

A government brief in opposition to the CFPB [in the PHH case] likely would have significant weight at the D.C. Circuit, and would boost the odds that the Justice Department might block CFPB efforts to push the case to the U.S. Supreme Court later on.

* * *

“In the longer term, an argument that the president can remove the CFPB director from office without cause, as the PHH panel decision held, would suggest that the president wishes either to fire Director Cordray without offering a cause, or at least to preserve his ability to do so,” Sovern told Bloomberg BNA. “Firing a director who has returned nearly $12 billion to nearly 30 million consumers would be difficult to square with the president’s pledge to aid ordinary Americans.”

NY Daily News: CFPB Budget Equals 2% of JP Morgan Chase 2013 Litigation Expense Reserves

So says Lisa Servon in her op-ed, Save the federal consumer watchdog: The CFPB protects us all.

Operators of bogus telemarketing scheme settle with FTC

The Federal Trade Commission announced yesterday that the operators of a telemarketing scheme charged with bilking millions of dollars from consumers, many of whom are seniors or military veterans on fixed income, will pay approximately $7.5 million in consumer redress under a settlement with the FTC.

The stipulated final order also prohibits the defendants – who operated under names such as Building Money, Prime Cash, Wyze Money, and Titan Income – from telemarketing, marketing investment opportunities, and selling or otherwise benefiting from consumers’ personal information.

In October 2016, the FTC filed a federal court complaint alleging that the defendants sold bogus online investment opportunities to people across the nation. The descriptions of the “opportunity” varied, but typically involved buying or investing in e-commerce related websites, or participating in a profit-sharing program involving credit card companies and e-commerce websites. The defendants got hefty payments from consumers – some exceeded $20,000.

The full FTC press release is here.

"Trump targets Obama’s global warming emissions rule for cars"

The Hill reports:

President Trump will sign an order Wednesday to formally evaluate the Obama administration’s landmark greenhouse gas emissions standards for cars.

The action, a top request from the automaker lobby to the new president, is the first step toward potentially weakening the aggressive standards that set a goal of a 54.5 mile-per-gallon auto fleet in 2025.

Trump will make the announcement during a trip to Michigan, the center of the domestic auto industry. He is expected to frame the action as a way to help auto industry jobs and consumer choice.

While automakers and congressional Republicans have pushed hard for the review and rollback, environmentalists and consumer advocates say former President Barack Obama’s standards protect the climate while saving consumers money.

The full article is a here.

NerdWallet Article Explores What CFPB Has Done to Help Consumers

Brad Wolverton's article, Your Wallet Will Suffer If This Agency Is Gutted, is an excellent roundup of the Bureau's accomplishments that cuts across a variety of areas, including student loans, credit cards, debt collection, mortgages, payday loans, credit reporting agencies, auto lending, consumer complaints, military protections, and arbitration. Excerpt:

Collectively, for every $1 in federal spending on the agency, more than $4 has been placed back in consumers’ pockets, a review by NerdWallet found. The agency has saved or returned to Americans $12 billion, while costing taxpayers $2.9 billion to operate over that period.

Other improvements, felt by virtually all consumers, have come in the form of lower costs, a more stable economy and new power to resolve individual disputes with financial institutions.

More on what Senator Ron Wyden calls "Robin Hood in reverse"

This article by Liz Goodwin includes both republican and democratic reactions to the Congressional Budget Office's analysis of the Republican bill to "repeal and replace" the Affordable Care Act -- that's the analysis that says millions upon millions of Americans will lose their health insurance under the bill. Goodwin's article also reminds us that the repeal is carried out in significant part by getting rid taxes on high-income Americans that the ACA uses to pay for, among other things, the ACA's insurance subsidies for low- to moderate-income Americans. That's why Senator Wyden calls the bill "Robin Hood in reverse."

Republican Majority Leader Kevin McCarthy is quoted as saying that "our plan does not force Americans to buy insurance plans they may not want or even need." That's true, sorta. The ACA's individual mandate requires people to buy insurance or pay a tax -- as Chief Justice John Roberts explained in upholding the ACA's individual mandate. And it's true that the Republican bill would get rid of the mandate.

Sure, you can get rid of the mandate on the ground that, just like the Romneycare mandate in Massachusetts, the mandate infringes the liberty of people who don't want or don't need health insurance. And, sure, healthy, mostly young people may not want or need high-priced medical care when they are healthy and young. It depends what we mean by "need." It's arguable that everyone needs insurance, although the need for insurance benefits generally is not immediate for someone who is healthy. But of course, almost all people who are healthy and young will want insurance and need benefits later in life.

So, here's what McCarthy and other Republicans are saying: We are going to allow people who don't want or "need" health insurance to stay out of the risk pool -- that is, they don't have to pay premiums or a tax in lieu of premiums if they don't want to, and they won't have insurance. Nonetheless, we promise that they'll get good coverage later when they have serious, pre-existing conditions. And the private insurance market is going to do this cheaply and with lots of great choices (to paraphrase our president), perhaps with a bit of help from a refundable tax credit (which is a form of public welfare benefit -- so much for the free market) and expanded tax-free health savings accounts (which disproportionately favor the wealthy because the wealthy have money to put into the accounts in the first place and because their marginal tax rates are high).

Good luck with all of that.

More on the ACA repeal-and replace-place bill, including how the bill breaks many of Trump's campaign promises

Read Trump’s Backing a Healthcare Plan That Breaks His Promises by Benjy Sarlin, which explains point by point how the bill, now backed by Trump, is at odds with Trump's campaign pledges. (No matter, that was before Trump discovered that "no one knew" how complicated health care was.)  And for more on the 24 million Americans likely to lose their health insurance under the bill, click on the embedded video below.