Add this to the list of reasons Donald Trump sold out his middle class and poor voters. Wall Street is obviously pulling the strings here, which explains the all too true joke of “If you want to talk to Goldman Sachs, call the Treasury Department.”
President Donald Trump on Wednesday signed the repeal of a banking rule that would have allowed consumers to join together to sue their bank or credit card company to resolve financial disputes.
The president signed the measure at the White House in private. Journalists were not present to witness the signing.
The Republican-led Senate narrowly voted to repeal the Consumer Financial Protection Bureau’s regulation, which the banking industry had been seeking to roll back.
If the rule had been allowed to go into effect in 2019, it could have exposed banks to large class-action lawsuits, a possibility that has taken gotten more attention following the sales practices scandal at Wells Fargo and the security breach at credit company Equifax.
The repeal means bank customers will still be subject to what are known as mandatory arbitration clauses. These clauses are buried in the fine print of nearly every checking account, credit card, payday loan, auto loan or other financial services contract and require customers to use arbitration to resolve any dispute with their bank. They effectively waive the customer’s right to sue.
The New York Times article is wrong when it says that the Obama administration installed “tough new regulations,” however. Dodd-Frank is a weak regulation with lots of loopholes written in by lobbyists, and the important provision of Glass-Steagall that separates depository banking and investment banking hasn’t been reinstated.
Under the Obama administration, no major banker went to prison for their involvement in causing the 2008 crash and Great Recession that harmed many millions of people. The fines imposed by the Obama administration also basically amount to a joke, even if they were several billion dollars. The Federal Reserve granted literally about $16 trillion (close to current U.S. annual GDP of $18.8 trillion) in virtually zero interest loans to big banks. The criminal penalties and fines for the large banks are therefore quite small and inconsequential to the corporate welfare the U.S. government granted them. How those big corporations think of those fines is as “a minor cost of doing business.”
Big U.S. banks such as Bank of America wouldn’t even exist today if the U.S. taxpayers hadn’t bailed them out. Of course, the banks still continue to screw over regular working people by using the government officials they buy to enact policy that’s damaging to the vast majority of the population. This is a technical term in economics and finance known as “screwing people over for higher profits.” The gratitude expressed by these artificial entities of greed and exploitation definitely has to be a finer point of corporate capitalism’s existence, doesn’t it?
What an absurd and horrible method to organize society, to have such a massive base of power around criminogenic financial corporations. It’s clear that results in much of society’s undeserved problems.