Open thread for night owls: How scandals make the financial industry ‘its own best enemy’

[ Originally published on this site as post ]

Mike Konczal at The Nation writes—The Financial Industry Is Its Own Best Enemy:

The financial sector is one of the biggest enemies of reform and accountability. Yet by consistently screwing up, it has also become the most influential advocate for outside regulation. Consciously through malice, or unconsciously through its size and complexity, it has time and again demonstrated the importance of the existing rules and the need for additional oversight. […]

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Which brings us to the Equifax scandal. Equifax, one of the three main consumer-credit data companies, is paid to spy on and compile all of your personal financial records. The company holds sensitive data on almost every aspect of our lives, yet hackers were able to get past their weak protection systems. This is because you aren’t a customer of Equifax; you are the company’s product. As a result, Equifax has no incentive to provide you with good services. In the wake of the hack, Equifax offered a credit-monitoring tool, but to use it consumers needed to sign a mandatory non-arbitration agreement that said they wouldn’t sue the company. (Equifax has since dropped this requirement after an outcry.)

These kinds of non-arbitration agreements replace courts with a private judicial system of company lawyers, and they have since metastasized across the entire economy. The CFPB recently finalized a rule that would outlaw these mandatory agreements by financial companies starting next year. Among other things, the rule would prevent Equifax from forcing people into arbitration after it goes into effect. Yet under an obscure congressional procedure, Republicans have the ability to repeal this rule with only 50 votes in the Senate. Though they might still do it, they’re having a harder time now, since they would be on the hook for any further abuses.

As reported by David Sirota, Equifax was one of the lead companies lobbying against the CFPB rule. But Equifax’s calamitous blunder, more than any white paper, demonstrates the need for strong new regulations to protect our personal data. If the rule survives, we can thank the companies whose own horrible gaffes demonstrated the need for it in the first place.

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“I was astonished, bewildered. This was America, a country where, whatever its faults, people could speak, write, assemble, demonstrate without fear. It was in the Constitution, the Bill of Rights. We were a democracy… But I knew it wasn’t a dream; there was a painful lump on the side of my head… The state and its police were not neutral referees in a society of contending interests. They were on the side of the rich and powerful. Free speech? Try it and the police will be there with their horses, their clubs, their guns, to stop you. From that moment on, I was no longer a liberal, a believer in the self-correcting character of American democracy. I was a radical, believing that something fundamental was wrong in this country—not just the existence of poverty amidst great wealth, not just the horrible treatment of black people, but something rotten at the root. The situation required not just a new president or new laws, but an uprooting of the old order, the introduction of a new kind of society—cooperative, peaceful, egalitarian.” 
              
~Howard Zinn, You Can’t Be Neutral on a Moving Train: A Personal History of Our Times (1994)
 

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BLAST FROM THE PAST

At Daily Kos on this date in 2006Fighting them there:

The problem with the whole idea that we’re fighting them there so we don’t have to fight them here (beyond the fact that Iraq never attacked the U.S. in the first place) is that we’re still the target. […]

No one here needs to be reminded that al Qaeda wasn’t even in Iraq until the U.S. invasion unleashed the chaos that has allowed them to flourish there. Somehow I don’t think that was part of the “good plan” for Iraq that Lieberman likes to talk about, or at least that he liked to talk about before he decided it was just politically safer to avoid the topic altogether.

On today’s Kagro in the Morning show: Trump-Russia has roots in Miss Universe 2013, because Trump World is a sex cult. How much is that Manfort in the window? The Natalia Veselnitskaya origin story. First evidence is in on domestic emoluments, and Russia’s real world organizing via Facebook.

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