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Although it took a few hours after the election to learn the results, it will take much longer for people around the world to truly understand what its long term effects will be. But when it comes to credit cards and consumer protections, Americans have already learned plenty about decision 2012.

Consumer Protection Over Deregulation

During the campaign, both major parties and their Presidential candidates offered contrasting views on how government should mediate between banks and consumers. President Obama has stood for greater consumer protections in his first term, and one could argue that he didn’t even leverage his accomplishments. For example, the CARD Act of 2009 that President Obama supported during his first year in office is widely seen as the most sweeping reform of the credit card industry in generations. Yet for some reason, this issue never featured prominently in his campaign or in the debates. Likewise, the Consumer Financial Protection Bureau (CFPB), created as part of the Dodd-Frank financial reform bill, is an unsung victory for consumers. Whereas the CARD Act went a long way towards curbing the historical abuses of the credit card industry, the CFPB grants regulators the power to crack down on unfair practices as they emerge without needing an additional act of Congress. In contrast, Mitt Romney was highly critical of financial industry regulation in general and the Dodd-Frank bill in particular.

But with these laws already passed, how much will the election actually matter? Quite a lot. For example, Republicans in Congress continued to resist funding of the CFPB and appointment of a consumer advocate to head the bureau. Furthermore, Congressional Republicans even passed a bill to reorganize the agency during its infancy. With the President re-elected and his party making modest gains in Congress, efforts to roll back his reforms are unlikely to progress.

A Powerful Consumer Advocate Goes to the Senate

Outside of Presidential politics, the next most important result of the 2012 election was the Democratic gains in the House of Representatives and especially the Senate. Democrats received a net gain of two Senate seats, but consumer advocates were particularly interested in the election of Democratic candidate Elizabeth Warren of Massachusetts who defeated the Republican incumbent Scott Brown to take the seat formerly held by the late Ted Kennedy. Warren has been a prominent consumer advocate and was a key figure in the creation of the CFPB. Warren was the natural favorite to become the first head of the agency, but her appointment was opposed by Republicans and financial institutions.

The election of 2012 and its barrage of campaign advertisements is now behind us, but better days appear to be ahead for consumers who use credit.

Image: Lisa Bettany, via Flickr

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