Technology is the answer
October 28, 2010 | CFPB Nomination, Elizabeth Warren, federal legislation | Comments (1)From Elizabeth Warren’s new blog post at WhiteHouse.gov:
I think the tools that can be at the new agency’s disposal will have at least three kinds of implications. First, information technology can help ensure that the new agency remains a steady and reliable voice for American families. The kinds of monitoring and transparency that technology make possible can help this agency ward off industry capture.
Second, technology can be used to make help the agency become an effective, high-performance institution that is able to update information, spot trends, and deliver government services twenty-four hours a day, seven days a week. If we set it up right from the beginning, the agency can collect and analyze data faster and get on top of problems as they occur, not years later. Think about how much sooner attention could have turned to foreclosure documentation (robo-signers and fake notaries) if, back in 2007 and 2008, the consumer agency had been in place to gather information and to act before the problem became a national scandal.
And third, technology can be used to expand publicly available data so that more people can analyze information, spot problems, and craft solutions. When these data are made available – while also, of course, protecting consumer privacy, shielding personal information and protecting proprietary business information – a shared opportunity arises between the agency and people outside government to have a hand in shaping the consumer credit world.
Warren always refers to the new bureaus as the CFPB, not the BCFP. So from now on, so will I.
Comments»
The greatest myth of all is that, had the Bureau existed prior to this disaster, it would have done anything to stop it. In fact, the issue has never been one of full disclosure – it has always been one of safety and soundness. (Do you really think that the average borrower needed more disclosure to know that misrepresenting their income and signing a note with a payment that was more than they could afford was wrong and risky?) All the regulators had to do was order FannieMae, FreddieMac and a handful of others to stop making and buying all those crazy stated income and neg am loans and this would have been prevented. No one else could have made them either because they would have had no where to sell them. The truth is that the banking regulators (and the borrowers) were just as drawn into to fantasy that we would never have a national housing recession as everyone else. Where was Elizabeth Warren then?