Seventy-one bills in 18 states have been passed to address toxic chemicals, and a few states, including Maine, Washington, Minnesota, and California, have moved to develop their own consumer-protection systems in the absence of federal rules.
Existing regulators have weighed in too, arguing that separating prudential regulation from consumer protection could make the system less safe.
To be clear, I do believe that centralizing the loan tracking and management systems into one website, providing better consumer protection by creating an efficient complaint system, and making it easier to discharge student debt in bankruptcy are all steps in the right direction.
Michael S. Barr, an assistant secretary at the Treasury Department, defended the president's plan before the Senate Banking Committee, arguing that the present system of consumer protection had been "designed to fail" and had contributed to the economic crisis.
Given that financial regulators — and the comptroller's office is not alone in this — often seem to think that threats to bank profitability can destabilize the financial system, the consumer protection bureau may have a tougher time doing its job than many suppose.
Sure, some of the proposals go in the right direction we need to regulate derivatives, someone needs to be thinking about systemic risk, and we ought to clean up the byzantine system of consumer protection.
Until the Bush administration, the F.D.A. itself viewed civil liability and its own regulation as complementary systems of consumer protection.
Later, Senator Bob Corker, Republican of Tennessee, pressed Mr. Wolin, saying: "I think what you're stating today is there's absolutely zero ability to make rules as it relates to consumer protection that relate to the financial system".
He wasn't precise about the translation, except to recommend higher capital requirements (again, no numbers), a method to manage the failure of a financial institution so it doesn't bring down the system and a consumer protection agency.
