Garrett Statement on Consumer Financial Protection Agency

Rep. Scott Garrett (R-NJ) released the following statement today regarding the Obama Administration's plans for a consumer financial protection agency:

"The administration claims that its financial services regulatory reform proposal seeks to address and reform the main areas in our financial system that are responsible for the credit crisis and recession, however, I do not see anything in its proposal to stop loose Federal Reserve monetary policy or to address the conflicts of interest inherent in its dual roles of monetary policy czar and safety and soundness regulator; I do not see anything to prevent misallocated credit decisions by the government through Fannie Mae and Freddie Mac; and finally, I do not see anything that will avert human error at regulatory agencies tasked with overseeing financial institutions - just the opposite. A consumer financial protection agency would be the creation of yet another regulator, with human error encouraged by separating regulatory decisions from the already limited expertise found at prudential regulatory agencies.

"It was policies by the government that largely got us into these problems and I don't believe that creating more government agencies, especially those with a heavy-handed, Orwellian, government-bureaucrat-knows-best mentality, is the appropriate solution.

"The Republicans have offered an alternative reform package that takes steady aim at ending government bailouts, reducing counterproductive government participation in private markets, appropriately streamlining and restructuring government oversight, and restoring market discipline and consumer empowerment. It protects consumers through improved disclosure and complaint resolution procedures by expanding the mission of the Financial Literacy and Education Commission and giving it the authority to direct regulated entities to disclose relevant policies, procedures, guidelines, standards and regulatory filings in order to empower consumers."

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Related terms: consumer, education, federal reserve, financial services, freddie mac, government, market, monetary policy, new jersey, recession, restructuring, standards