WASHINGTON — US President Barack Obama on Friday accused big business and its lobbyists of trying to kill his bid to pass a new law shielding US consumers from ruinous predatory lending practices.
The president spoke out in favor of his proposed Consumer Financial Protection Agency, part of a wider regulatory reform effort designed to rein in Wall Street abuses, which is currently being considered in Congress.
“Predictably, a lot of the banks and big financial firms don’t like the idea of a consumer agency very much,” Obama said at the White House, hours after he was named as this year’s surprise recipient of the Nobel Peace Prize.
“In fact, the US Chamber of Commerce is spending millions on an ad campaign to kill it,” Obama told an audience of members of Congress, local state officials, finance industry workers and community leaders.
Obama denied claims by critics that the proposed agency would restrict consumer choice and innovation, saying it would set ground rules so that credit card, mortgage and finance firms could not confuse customers with outrageous terms and conditions.
“But all this hasn’t stopped the big financial firms and their lobbyists from mobilizing against change,” he said.
“They’re doing what they always do — descending on Congress and using every bit of influence they have to maintain the status quo that has maximized their profits at the expense of American consumers.
“We have already seen and lived the consequences of what happens when there is too little accountability on Wall Street and too little protection for Main Street, and I will not allow this country to go back there.”
The US Chamber of Commerce rejects Obama’s complaints, and warns that the proposed reforms will create an unwieldy federal agency that will make the problems worse for consumers and business.
The president wants Congress to act this year on what is billed as the most sweeping financial regulatory reform since the 1930s, despite a crush of other business.
His proposals for greater regulation would give the Federal Reserve expanded powers to oversee regulation on all finance firms or banks that pose a significant systemic risk to the wider financial infrastructure.
They would introduce new discipline and transparency into financial markets and would enable investors to better ride out the failure of one or more large financial institution.