Progress Illinois

The following is an op-ed from Celeste Meiffren, field director for Illinois PIRG.

Since July 21, the new Consumer Financial Protection Bureau, or CFPB – a centerpiece of the 2010 Wall Street Reform and Consumer Protection Act --  has been up and running. It’s the nation’s first federal financial regulator with only one job—protecting consumers from unfair financial practices. Yet, until the bureau has a director, it does not gain all of its new authority to protect the public.

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In the most interesting political rumor of the day, the Wall Street Journal listed Attorney General Lisa Madigan as a possible director of the new Consumer Financial Protection Bureau, if and when Congress finally approves the financial reform package.

If named, Madigan would probably thrive in the roll. She's spent the bulk of her tenure as the state's lead attorney fighting on behalf of consumers, whether those exploited by mortgage lenders, utility companies, polluters, or low-cost lenders. Indeed, she was a high-profile advocate of creating the bureau in the first place.

But would she take the job? Back when her name came up as a potential U.S. Senate candidate, she took her name out of the running, citing family implications.

UPDATE (7/7): Madigan threw some cold water on the rumor last night, recommending Harvard Law Professor Elizabeth Warren for the post.

Payday lenders, beware. The installment loan reform bill (HB 537) we've been tracking for months, which would close a gaping loophole in the 2005 Payday Loan Reform Act, has been assigned to the House Executive Committee and will get a hearing Monday afternoon. Also on tap are a few technical changes to the pension borrowing bill (SB 49), which still has no Republican supporters. The Sun-Times editorialized in favor of the measure this morning, writing that a payment delay "defies all logic."

Large telecom companies in Illinois won a big victory in Springfield last week when both chambers unanimously approved a significant rewrite of the Illinois Telecommunications Act. Despite the wide support the bill earned in the legislature, consumer advocates are justifiably worried about some of the language. While they were able to preserve "safe-harbor" packages -- which guarantee low landline phone rates for vulnerable customers -- the Citizens Utility Board (CUB) could not keep in place an Illinois Commerce Commission order requiring AT&T to offer high-speed Internet access to 90 percent of its customers outside the Chicago area. In fact, CUB spokesperson Jim Chilsen tells us his organization is urging Gov. Pat Quinn to issue an amendatory veto to reinstate this mandate.

On Tuesday night, Chris Wetterich analyzed the politics of a potential veto for Quinn, who was instrumental in CUB's formation. To reject the change, both chambers would need a three-fifths majority.

As we (and Attorney General Lisa Madigan) feared, an amendment to the Senate financial reform bill was filed that would strip the power of state regulators to enforce consumer regulations on national banks and their subsidiaries. More ominously, four Democratic senators -- Sens. Tom Carper (D-DE), Mark Warner (D-VA), Tim Johnson (D-SD), and Evan Bayh (D-IN) -- have already come out in support of the measure. For an explanation about why this issue is important, read Mike Konczal. And check out Matt Yglesias's post warning about the potential of Wall Street reform opponents from both parties loading up the bill with bogus amendments and then voting against it anyway.

UPDATE (3:40 p.m.): "If there is a remaining amendment fight to engage in on Wall Street reform," writes Open Left's Chris Bowers, "this is probably the best one."

As the GOP (and the bank lobbyists on which they rely) try to chip away at the U.S. Senate financial reform bill, rumors are swirling that lawmakers may strike a deal forcing federal regulators at the new Consumer Financial Protection Agency to preempt stronger state consumer financial protections. In the House, Rep. Melissa Bean led the charge for such language, finally agreeing on a compromise measure to allow for preemption on a case-by-case basis. Now, if the bankers get their way, the Senate may limit the reach of state laws even more. "This essentially takes cops off the beat," writes FireDogLake's David Dayen, "at a time when we should be adding them."

Illinois Attorney General Lisa Madigan fought Bean's effort last winter. On Friday, she released another strong statement warning the Senate to proceed with caution. "In a time of global economic crisis," she said, "we clearly need more enforcers of consumer protection laws, not fewer." Read it here.