01 March 2016

Debbie Wasserman-Schultz Really Needs to be Fired

Even if you ignore her tenure at the DNC, which is marked by incompetence, careerism, and biased, her history in supporting the most egregious examples of abusive consumer is a reason to force her retirement.

In November, she voted to allow car dealers to discriminate against minorities:
Before Thanksgiving, Florida Congresswoman Debbie Wasserman Schultz helped push through congress a bill that would allow automobile dealers and auto finance companies to discriminate against minority and unsophisticated car buyers by charging them more in fees and interest rates.

The Reforming CFPB Indirect Auto Financing Guidance Act that Wasserman Schultz voted for would basically let lenders and dealers ignore Consumer Financial Protection Bureau rules that bar dealers and auto finance companies from charging unsophisticated borrowers who are mostly minorities hundreds of dollars more in excessive interest and fees on car loans regardless if the car buyer has excellent credit.

The National Automobile Dealers Association or NADA is pushing this bill because they realized that after dusting off an old marketing book from Wells Fargo, that their members could easily widen their profit margins by adding stealth fees and charging higher interest rates to unsophisticated minority consumers who are just happy they can own a new car.

The bill is, as Brian O’Connor at the Detroit News points out, “a repulsive layering of racism wrapped in consumer rip-offs wrapped in a layer of lies and stuffed with lots and lots of campaign cash.”

Like an old sub-prime mortgage, the auto finance company sets a minimum interest rate on car loan made through a dealer, and the dealer can then hike the interest rate to 2.5 percentage points or more with the lender kicking in back end points equaling 1% to 3% of the sale price of the car to the dealer and the salesman. This similar to what used to be called Yield Spread Premiums in lending. In other words, NADA wants and what Wasserman Schultz endorses is really ghetto loans for cars.
And now she's tring to hamgstring the CFPB's attempts to regulate the worst practices of the payday lending industry:
One of the benefits of America’s unusually stingy welfare system is that it allows our domestic payday-loan industry to thrive. Since the safety net is too threadbare to catch the working poor when they fall on troubled times, payday lenders are able to charge them exorbitant interest on subsistence loans. Nationally, the average interest rate on a payday loan is a stellar 390 percent.

But Elizabeth Warren’s Consumer Financial Protection Bureau is dead set on sapping all of the dynamism out of the payday-loan industry. The CFPB is about to issue new regulations on payday lenders that are aimed at preventing borrowers from falling into a vicious (or viciously profitable) cycle where they take out high-interest loans just to make the interest payments on their previous high-interest loans. Fortunately, DNC chair Debbie Wasserman Schultz is co-sponsoring a bill that would gut the CFPB’s regulations and allow payday lenders to keep profiting off the desperation of the impoverished.

According to a memo obtained by the Huffington Post, Wasserman Schultz is trying to rally congressional Democrats around a bill that would delay the CFPB’s new rules for two years and nullify those rules in any state that adopts its own payday-lending law, like the DNC chair’s own home state of Florida.

The key thing about such state laws is that they’re likely to be much kinder to the profits of payday lenders than what the CFPB is crafting. In Florida, the average interest rate on a payday loan is still 304 percent, according to Pew Charitable Trusts. What’s more, 76 percent of all payday loans in the state are turned loans — loans taken out to pay back another loan — according to Americans for Financial Reform. Thus, Florida’s law has left the highly profitable vicious cycle of payday borrowing intact.


With such brave legislators leading the Democratic Party, it’s difficult to understand how Bernie Sanders can get so mad at the “Establishment.”
H/t Naked Capitalism, where they also note that DWS recently signed onto a letter to the CFPB asking for an exemption for credit unions and banks smaller than $10 billion from consumer protecting regulations.

Seriously.  What is wrong with the Democratic Party?

I kind of understand how one might be tempted to make use of an evil person's evil, but Debbie Wasserman-Schultz is to incompetent that her evil servs no one.

If she were were in a James Thurber novel, the Todal would have Gleeped her by now.*

Support Tim Canova, who primarying her.

*The 13 Clocks. Just go read it.


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