Home > Personal Finance > Hello Citizens United, Goodbye CFPB: Consequences of the Wisconsin Recall

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I have watched with horror Republican efforts to emasculate, strangle and kill the new Consumer Financial Protection Bureau. At present, there are at least nine pieces of legislation (that we know of) snaking their way through Congress that would dismantle a number of the provisions of the Dodd-Frank Act and in the process annihilate the CFPB.

I am convinced that if the masters of the universe seize the White House and further erode, or take out, the Democratic majority in the U.S. Senate, consumer protection in this country, along with women’s rights, civil rights and access to health care will be set back a generation. We will see a U.S. Supreme Court as activist in eroding our civil liberties as the Warren Court was aggressive in protecting them.

In four short years we have gone from, “Yes we can!” to “No you don’t!” to “No you can’t!” to “Fuhggetaboutit!”

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Check Your Credit For FreeIf the recall vote in Wisconsin is any hint of what is to come in the next few months, caveat emptor will be the catch phrase of the marketplace and government will go from being our protector to being a supplicant of the one tenth of one percent.

Lest we forget the now infamous quote from House Finance Committee Chairman Spencer Bacchus (R-AL),”In Washington, the view is that the banks are to be regulated, and my view is that Washington and the regulators are there to serve the banks.”

Despite polls, pundits, and political prognosticators expecting a very close contest, this week’s election in Wisconsin was more or less a Republican landslide; the major networks announced the results only 45 minutes after the closing of the polls. Scott Walker, only the third governor in American history to be subjected to a recall election, became the first governor to win one. The five other recall races–for lieutenant governor and four seats in the state Senate, also resulted in lopsided GOP majorities.

[Related Article: CFPB’s New Guidelines for Mortgage Servicing]

For the moment, forget the specific Wisconsin issues. Forget that there has been some very recent and fairly ominous talk of the possible indictment of the Governor. Forget that the Los Angeles Times reported on an attempt to suppress the vote; “Numerous voters said they received a “robo-call” telling them “if you signed the recall petition, your job is done and you don’t need to vote on Tuesday.” Think on this instead: $63.5 million was spent on the recall election, about 70% more than was spent on the 2010 gubernatorial campaign where Walker beat the same Democratic opponent, by a slightly lower margin of victory. Walker’s campaign itself raised more than seven times the money raised by his adversary, with about three out of every five dollars coming from out-of-state sources. And Walker-supporting superPACs provided nearly three times the money given by their Democratic equivalents.

This is the strange fruit of the now infamous Citizens United decision. Welcome to 21st-century America, where everything really IS for sale. As Ronald Reagan, put it: “It has been said that politics is the second oldest profession. I have learned that it bears a striking resemblance to the first.”

What bothers me is not that Walker survived the recall, but what it means for the general election. It is clear that Obama has been outgunned by Wall Street, and thus is likely to be similarly outgunned by Romney’s superPACs in November. If, for example, those upcoming elections are purchased, resulting in a conservative majority in both houses under a conservative president, there will be a “rush to repeal.” My bet would be that Dodd-Frank would be the first to go under the knife, even before Obama care. While there are those who argue that many of the Dodd-Frank regulations are ill advised and should be either amended or eliminated, I believe the CFPB–the most important and necessary creation of that legislation–would be the baby thrown out with the bathwater. In my opinion, this would set back the cause of consumer protection for a generation.

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Image: Jason Dean, via Flickr

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