by Jeff Sovern
President Obama has done more for consumer protection than any president in a generation. His accomplishments include signing the Dodd-Frank Act, which created the Consumer Financial Protection Bureau, anti-predatory lending laws, and limited the power of traditionally pro-bank agencies like the OCC to preempt state laws protective of consumers; signing the Credit CARD Act into law; and appointing or nominating officials interested in protecting consumers at various federal agencies. And yet, consumer protection was largely absent from the presidential election. To the best of my knowledge, Governor Romney never even said whether he would support or seek to repeal the CFPB (he said he wanted to repeal some aspects of Dodd-Frank, but did not identify those aspects). And while both candidates spoke of the president's record, neither said much about his record in consumer protection.
Why is that? One possibility is that with the enactment of the new laws, consumer protection has receded into the background. Certainly other pressing national problems remain. My suspicion is that the campaign's research–focus-groups and the like–persuaded them that they could not win votes by bringing up consumer protection. But the media largely ignored the issue too. During the debates, I didn't hear a single question about consumer protection; while the candidates mentioned student loans, the question did not actually ask about them (I should note that I missed portions of the debates, so it is possible I overlooked something on consumer protection).
Dennis D. Hirsch of Capital Law School has written about what privacy law could learn from environmental law; certainly environmental advocates have been much more successful at stimulating public debate and securing favorable legislation than consumer advocates. To be sure, environmental law raises issues of public health and even existential questions. But plenty of people are out of a home because of consumer protection failures and many others have suffered unfairness and significant financial setbacks. Other financial issues, like taxes, seem to come up in every election. And yet, many consumers have more at stake in consumer law than tax law, like those who lost their homes. Is it because consumer issues tend to be more important for those at the bottom of the economic ladder whle tax issues are more crucial for those at the top? Fairness seems relevant to both.
Sometimes I wonder if behavioral economics might explain it. We all face a risk of encountering consumer protection problems, like identity theft, and the optimisim bias leads us to give less attention to bad outcomes which may not occur. And many consumer protection issues are complicated or technical (think preemption). Still, what a shame that something so important received so little attention in the campaigns. The president's consumer protection initiatives saved a lot of people a great deal of pain and money. Consumer protection should have received some attention. To be sure, much that needed doing in the area was done over the last four years. But much still remains.