Center for American Progress

How the CFPB Fight Is a Sign of the Next Financial Crisis
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How the CFPB Fight Is a Sign of the Next Financial Crisis

Authors Michael Barr and Joe Valenti explain how the dueling director battle at the Consumer Financial Protection Bureau may portend for future crises.

Authors

  • Michael Barr
  • Joe Valenti

The Consumer Financial Protection Bureau (CFPB) was created after the 2007–08 financial crisis as an independent watchdog for the public. The crisis demonstrated that while abusing consumers might be profitable in the short term, it leads to greater long-term risks if left unaddressed.

By and large, the steps taken post-crisis are working. Credit card customers have seen costs go down—saving on average about $300 per year for those who carry a balance—while the volume of consumer credit is back to pre-crisis levels and regulations have clamped down on hidden fees. Banks are as profitable as ever, and the Dow is at record highs.

The above excerpt was originally published in Fortune. Click here to view the full article.

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Authors

Michael Barr

Senior Fellow

Joe Valenti

Director, Consumer Finance