This Week in Congress: Choice for Wall Street and Flexibility for Corporate America
By Amy Traub, Demos
Soaring rhetoric about freedom and choice is everywhere on Capitol Hill this week.
From the chamber of the House Financial Services Committee, we hear that consumers are losing “economic opportunity and freedom” because they don’t have enough access to risky, high-cost credit. The Financial CHOICE Act, subject of a hearing this Wednesday, would restore lost liberty by gutting consumer safeguards. Meanwhile, the House Education and Workforce Committee frets that workers miss out on “freedom, choice, and fairness” because they lack the opportunity to trade away overtime pay for the chance to ask the boss for time off. Under the Working Families Flexibility Act, also due to be marked up this week, employees would be liberated from decades of pesky worker protections.
Of course, many Americans would appreciate more flexibility at work and more choices when we need a loan. Unfortunately, while these bills are wrapped in rhetoric about freedom for ordinary consumers and workers, the legislation being considered would actually place greater power into the hands of banks and employers. All the choices are for Wall Street, and all the flexibility is for corporate bosses.
Consider the Financial CHOICE Act, sponsored by House Financial Services Chairman Jeb Hensarling (TX). The legislation rolls back key provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act, which was enacted after the 2008 financial crisis to rein in the reckless banks that brought down the economy. In particular, the bill eviscerates the Consumer Financial Protection Bureau (CFPB), an agency devoted to battling financial scams and rip-offs and making sure banks and other financial companies treat consumers fairly.
Since it was established in 2011 the CFPB has returned $11.8 billion to nearly 30 million Americans who were cheated by financial companies. As I’ve noted before, unscrupulous financial corporations could make a whole lot more money if the CFPB didn’t stand in their way. By eliminating the CFPB’s independent funding, weakening the position of the agency’s director, and eliminating whole swaths of authority to supervise financial institutions and challenge unfair and deceptive financial practices, the Financial CHOICE Act enacts the financial scammers’ wish list, rendering the CFPB a feeble shadow of its current self. At the bottom line, consumers would again be “free” to be ripped off by deceptively marketed financial products and cheated by loans that are designed to fail.
The Working Families’ Flexibility Act offers a similar bait and switch. From California to Connecticut and Minneapolis to Pittsburgh, states and cities across the nation are taking action to guarantee working people the right to paid leave. Laws to provide similar guarantees of paid sick time and time to care for a new child or ailing loved one are now pending in Congress – yet the Working Families Flexibility Act is not one of them.
Instead of guaranteeing access to paid leave when working people need it, the bill sponsored by Rep. Martha Roby (AL) and Senator Mike Lee (UT) simply gives more power to bosses. First, companies would have a new option to offer “comp time” instead of the overtime pay that many workers are now owed when they’re on the job more than 40 hours a week. If employers opt for comp time, workers who once earned overtime would be handed a sizable pay cut. Next, employers could decide when workers are permitted to use the comp time they’ve accrued, meaning pay could still be denied to a worker in bed with the flu even if he had comp time accrued. An expecting mother could be refused the right to use her accrued comp time for parental leave if her baby is inconveniently born at a time when the company would prefer to have everyone working. Under the Working Families Flexibility Act, employers would be granted more flexibility, but working Americans would only gain the “freedom” to work for less money and take time off when it’s convenient for the boss.
Dressing up a fundamentally anti-worker, anti-consumer agenda in the language of freedom, flexibility, and choice does nothing to change its true aim of increasing the power that Wall Street and corporate America have over ordinary citizens. It’s up to Americans to see through the disguise and oppose these noxious bills.