The Trump administration has once again put corporate profits ahead of the best interests of families.
On Wednesday, the Trump administration delivered a victory to predatory payday lenders, proposing a new rule that will help them exploit low-income families.
In a roundly criticized move, the new rule from the Consumer Finance Protection Bureau (CFPB) would roll back Obama-era guidelines meant to rein in some of the most pernicious tactics used by payday lenders.
The Washington Post said the move is equivalent to “boosting the fortunes of an industry accused of keeping low-income borrowers trapped in a cycle of debt.”
According to Rep. Katie Porter (D-CA), it’s more proof the Trump administration is “putting corporate profits ahead of protecting American families from abusive practices.”
The rule issued under President Obama required payday lenders to ensure that people taking out loans have the ability to repay them. But CFPB under Trump wants to undo the rule and allow payday lenders to exploit low-income workers who are forced to rely on the predatory services.
Under the system Trump prefers, borrowers sometimes take months to repay high-interest loans meant to be repaid in weeks. Some families are then forced to take out additional loans — at 300 percent interest or more — to pay off old loans, leading to a cycle of debt, says Rep. Maxine Waters (D-CA), chair of the House Financial Services Committee.
Waters put out a statement condemning the proposed rule change, saying the move left her “deeply troubled.”
Former CFPB director Richard Cordray was also critical, issuing a statement saying the decision “will hurt those who are being abused and mistreated by ruinous loans.”
The rollback from CFPB is laced with controversy. The Washington Post reports that lobbyists for payday lenders held multiple events at Trump properties over the past several years. Since Trump financially benefits from these events, government watchdogs warn they could be “legal bribery, a way to influence regulation and policy by giving money to the president.”
Unfortunately, this is not the first time the Trump administration prioritized corporate profits over the well-being of families. Trump supported and signed the GOP tax scam into law. That bill showered corporations with billions of dollars of tax cuts, while middle-class families were largely left out in the cold.
A recent report showed big Wall Street banks raked in $21 billion from the tax scam, yet still cut thousands of jobs. While other corporations also received a windfall from Republicans, they did not choose to invest in hiring more workers or increasing wages. Instead, corporations lavished Wall Street investors with stock buybacks, doing next to nothing to help the average worker.
The desire to eliminate protections for the most vulnerable, for no reason other than corporate profits, fits into a disturbing Trump administration pattern.
Published with permission of The American Independent.