Consumer Finance Pacification Agency

“The most effective and enduring form of warfare against liberation is the implanting of material and intellectual needs that perpetuate obsolete forms of the struggle for existence.”

–Herbert Marcuse / One Dimensional Man: Studies in the Ideology of Advanced Industrial Society

On this day, September 9, 2010, consumers around the country are breathing a deep sigh of relief upon hearing the news that Harvard law professor, Elizabeth Warren, has successfully persuaded the United States government to institute a Consumer Finance Protection Agency that would help curtail the unethical business practices that have come to define Wall street over the past ten years. While this type of oversight is vital to the overall health of the middle class I’m afraid it fits into the same category as all the other “sweeping changes” that an uninformed population hurries to praise. Indeed, in a state capitalist society such as ours, consumers need protection from predatory lenders but does not the existence of this consumer protection agency reinforce the notion that highly amoral banks and corporations are necessary components in a post-industrial society?

My criticism of this agency is not that of the big bankers who believe that it goes too far in curtailing their freedom to oppress. My problem with this agency is that it doesn’t go far enough in depriving bankers of these unchecked liberties. Much like the healthcare insurance reform that further entrenched American citizens in the immoral profit-based medical industry, this consumer protection agency has the potential to further entrench American workers into passively accepting the profit-based financial industry. In this respect, the creation of this new consumer protection agency may be less about protecting consumers and more about pacifying them. This agency is pacifying all except those individuals who believe that corporations are not entities to be disciplined but entities to be dismantled. And this is the missing dimension of the current agency. It forfeits the promises of a radical restructuring of our economic system for the more politically acceptable option of reforming it. As Jean Paul Sartre once remarked “the machine cannot be fixed. It must be seized and destroyed.”Echoing the rhetoric of President Obama in his speech on economic reform before a crowd in Wisconsin, Professor Warren vowed to “keep pushing for the middle class”. This sentiment was met with thunderous applause, an applause that overshadowed the systemic inequality of our capitalist economy; namely, the idea that it can only function if there is always a class of dispossessed people (yes, people not consumers!). Invariably, economic reform in the United States is directed toward strengthening the middle class and ignoring the underclass. On top of the burden of invisibility that our underclass endures in their daily lives they must also be removed from our political discourse. How can we fashion ourselves as a democracy when we are routinely ignoring the poorest people in our country? How can we fashion ourselves as a democracy when the misery of poor is as integral a part to the survival of the system as the greed of the wealthy?

Several economists and analysts are hailing the creation of this agency as the most comprehensive piece of financial regulation since the New Deal which was a genuinely progressive piece of legislation that helped level the playing field until the Clinton Administration repealed the Glass Steagall Act in November of 1999. This repeal of the Glass-Steagall Act eliminated the regulatory apparatus that made it illegal for commercial banks to mix with investment banks. Consequently, this repeal paved the way for the economic disaster that we find ourselves in today. Because of this repeal the world population is suffering the from the irresponsibility of a handful of privileged men. Individuals like Lawrence Summers, Robert Rubin, Rahm Immanuel and other individuals who bear the deceptive title of “Democrat”. So if this consumer protection agency does not present a policy that would lead to a fundamental restructuring what will? In order to extract ourselves from the ubiquitous nature of this system of domination no single act is more courageous than that of resistance. Indeed, we must refuse to participate in a system that protects consumers and rejects people. More than reformers we need radicals. There will be no substantive change until we come to the realization that mere reform will only prolong the comfortable servitude of the modern state capitalist enterprise.


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