Saturday, June 11, 2011

Consumer Financial Protection Bureau…”Protecting You”

This is what the new CFPB professes to do – Protect You

But do we need protecting?  A fine statesman once said “a government big enough to give you everything you need, is big enough to take away everything you have”, and this new step-child of Dodd-Frank can do just that.  The CFPB will have vast new powers to write rules affecting everything from payday loans to mortgages to bank accounts.  What will this mean for you?  Less choice, for sure.

This Bureau, with the stroke of a pen, can disappear businesses, like pay-day loans, with zero accountability.  This will have a chilling effect on innovation, dis-incentivizing entrepreneurs from developing new products and services.  Even worse, the Federal Reserve, not Congress, determines the bureau’s budget, paving the way for unchecked growth and expansion.

The CFPB is tasked with an impossible and foolhardy mission: determining which products and services are “bad” for consumers before they are brought to market.  Government bureaucrats can’t determine this, only consumers engaged in free exchange with merchants can decide which products and services win out.  Certainly, there exists miscreants prowling about ready to cheat you out of your money, but they usually don’t survive for very long.  And if you are cheated, the rule of law affords you redress. 

Smart and savvy consumers are the best market watchdog, not another unruly government agency masquerading as the Money Police.  Our liberty is at stake and every new government program, agency, and bureau threatens to take it away – all in the name of “protecting you”. 

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