“The country needs and, unless I mistake its temper, the country demands bold, persistent experimentation. It is common sense to take a method and try it: If it fails, admit it frankly and try another. But above all, try something.”
– Franklin D. Roosevelt, 1932
We are at the time when our economy is not an economy worthy to be part of the country that once was called a Super Power. Isn’t time we try something new? If something clearly doesn’t work, we need to take a step back and look at the big picture, to analyze what went wrong. Identifying our faults and errors is the first step in finding the right solution that works. This is exactly what Obama’s overhaul of our financial system is tasked to do.
Today, President Obama outlined his plans for overhauling American financial system. It clearly was due for a tune-up back in 80’s when we hit a recession, but no one took the time to do it. Almost two decades later, the system that once worked so well began to stall, and once it dies there is no roadside assistance we can call. We are at the time when “the country demands bold, persistent experimentation”, as Roosevelt stated. American voted for Obama because he promised us Change. Isn’t this change? Isn’t he delivering his promise to the American people?
It takes courage to implement new legislations that affect the entire country, but we are at the time when we have nothing to lose. We cannot let America be the next Titanic, headed on the collision course with an iceberg.
Obama’s administration was able to identify one key element that brought our economy to its knees – the consumer spending habits. All those pre-approved credit card offers, 15% on purchases when you open store card, or those absolutely needless payday loans began to affect our financial system. However, the new agency needs to monitor not only the companies that give any kind of credit, but it needs to monitor consumer credit requests. If you think it would violate your privacy than stop spending carelessly, have some self-control. Blaming banks and corporations for this mess is not an answer or a solution. George Bernard Shaw said it right, “People are always blaming their circumstances for what they are. I don’t believe in circumstances. The people who get on in this world are the people who get up and look for the circumstances they want, and if they can’t find them, make them.”
We represent an entire nation, what we do affects us all. When you travel to other countries do they call you by your name? Do they they call you “New Yorkers” or “Californians”? No, they call you “American”, because you represent your nation, your people. Why is it so hard to understand that you are not alone? There are over 300 million Americans. Even if you don’t see it, but even the smallest actions of one American affects the entire nation, one way or the other.
If the new consumer protection agency wants to be successful in protecting consumers, they need:
- Cap APR, there is no reason why any APR should be over 18%.
- Eliminate payday loans, it was built to increase debt and make money for lenders.
- Make loss of income insurance mandatory for all loans
- Ban “pre-approved” junk mailings unless consumer requested it or it was sent from his/her bank
- Limit number of credit cards allowed per individual and per household
- Put tougher limits on credit line and income.
- Educate public by requiring each credit applicant to pass a small quiz about financial basics before allowing them to apply for any credit
- Shutdown internet scams
- Create easy website for consumers to report any violations
These are just a few suggestions that the new consumer protection agency should consider. They will help American public deal with financial giant that overwhelms them with high fees, junk mail, and collection calls. American people cannot do it themselves, they have no self-control to do it. Otherwise, we wouldn’t be in this mess. They need help, they need Uncle Sam to hold their hand. As childish as it may sound, it is what it is.
Jennifer Liberto, senior writer for CNNMoney.com, reports, “A lot of banks and trade associations oppose the new consumer protection agency — especially the idea of giving it power to curb financial products if they’re found to be deceptive or unfair.” When the bullies don’t want to stop harassing, you need to get Uncle Sam involved to make sure they stop harassing public.
The new change that Obama is bringing upon us promises to bring some stability and order to our financial system. It’s going to be a long time, but once the economy will begin to settle and financial sector will get adjusted to the new regulations and the new watchdog, the ride will get smoother and unemployment rate will begin to drop. Right now, we need to stay educated and alert more than ever before. The New Deal of the 21st century is the key to our stable financial future; there will be bumps on the way but “persistent experimentation” is a lot better than to quietly get beaten up by the status quo.