by Jeremy Leaming
Up until the $2 billion trading loss debacle at JPMorgan Chase, right-wing lawmakers in Congress, primarily the House, were feverishly working to water down with new legislative measures Dodd-Frank, the financial reform law passed in the wake of the Great Recession.
But, as CQ Today reported, House Republicans halted their efforts “at least for now” to undercut the law aimed at ending the shady tactics employed by financial industry giants that led to the financial meltdown of 2008. Part of Dodd-Frank created the Consumer Financial Protection Bureau or CFPB, which is tasked with trying to bring some sanity to the financial industry.
As CFPB Director Richard Cordray (pictured) said during the ACS 2012 Convention the agency is the first ever “created with the sole purpose of protecting consumers in the financial marketplace. It is not an easy task, but it is crucial because the financial marketplace is no easy place for our fellow citizens as they seek to manage their affairs.
Cordray continued, “Our task is so crucial because, as we saw with the recent financial crisis, unregulated or poorly regulated financial markets can undermine the stability of the economy and with it the promotion of the general welfare that, as specified in the preamble to the Constitution, stands as one of the basic purposes of the federal government. For that reason, the new Consumer Bureau was also created to help ensure that the recent financial panic and economic meltdown does not repeat itself.”
But government efforts to help the nation’s less fortunate or vulnerable run counter to the interests of the nation’s super wealthy. Columbia University business school professor Joseph Stiglitz, author of Freefall, has noted that the nation’ top one percent has the greatest sway in the nation’s capital, and that it is largely not interested in progressive legislation.
So like the efforts to reform the nation’s health care system, which includes tens of millions of uninsured, the Right is turning to the federal bench to try stymie progress. And as noted by the Constitutional Accountability Center’s Simon Lazarus the Right and libertarians have proven their acumen in advancing their views of a radically cramped Constitution and selling wobbly legal claims to the public.
Media Matters’ David Lyle in a post for the organization’s County Fair blog called “First Health Care, Now Dodd-Frank: The Tea Party Constitution Rises Again,” urges progressives to be better prepared.
“Although the legal arguments made in the suit [lawsuit lodged in federal court last week challenging the constitutionality of Dodd-Frank] are questionable, the case should not be dismissed as harmless,” Lyle writes. “The right-wing media’s proven ability to move dubious legal claims into mainstream debate combined with a conservative federal judiciary sympathetic to corporate interests mean the CFPB suit bears close scrutiny.”
Lyle notes experts doubt the challengers have standing to lodge the lawsuit, and that at least one “financial services regulatory lawyer” has concluded it doubtful “that a court would find significant provisions of Dodd-Frank unconstitutional because of ‘general vagueness considerations.’”
But not long after the states’ attorneys general lodged lawsuits against the Affordable Care Act, many constitutional law experts said there was little chance the high court would find the law’s integral measure – the minimum coverage provision – an unconstitutional regulation of commerce.
We’ll likely know tomorrow whether those experts were right. But what we do know is that right-wing and libertarian pundits, scholars and lawyers successfully convinced a wide swath of the public that the ACA’s minimum coverage provision is a serious affront to liberty. (And at oral argument it appeared that Justices Antonin Scalia and Samuel Alito also embraced the rhetoric.)
That’s why, as Lyle warns, liberals cannot let the far-fetched arguments aimed at destroying commonsense, and long overdue financial regulation, go unanswered.