In this era of ever-diminishing expectations, it sometimes comes as a bit of a shock to realize, hey, isn't mild improvement in some areas better than the wholesale retreat we've become accustomed to?
After noting that when he began his career as a legal services lawyer in the 1970s, the notion of "consumer protection" was receiving unprecedented support from legislatures and courts, Sommer paints a dire picture of the three decades that followed.
[W]e've gone backwards in ways that were literally inconceivable in the 1970's. Usury limits were, for all practical purposes, eliminated. A generation of conservative judges, appointed by the Reagan and Bush administrations, began taking legally formalistic approaches that sanctified the fiction of the rational and informed consumer who made all decisions according to her real economic interests. They enforced small print contracts devised by battalions of credit industry attorneys and placed numerous obstacles in the path of class relief (indeed, any relief) in the courts, foremost among them being the mandatory arbitration clauses that became ubiquitous. Consumer protection agencies and legal services programs lost most of their funding and were subject to severe restrictions on the cases they could bring. Some federal agencies, notably some of the banking regulators and the United States Trustee program that administers U.S. bankruptcy cases, actually became, for all intents and purposes, advocates for the consumer credit industry.
But times have changed, again.
... [T]he tide may be turning. Congress has passed new laws limiting some of the worst credit card abuses. The new financial regulation bill includes some limits on predatory mortgage lending and, of course, the new consumer financial protection bureau.
The new financial regulation bill is not yet a done deal, of course. The House voted on Wednesday to approve the conference report, but the Senate won't be voting until after the July 4th Congressional recess. (And who knows what else Emperor Scott Brown will decide he doesn't like in the meantime.) As Sommer warns, "we have a long way to go."
But at least we're inching forward, instead of hurtling in reverse.