You know what will make you look important to all your connections on LinkedIn? Being connected to the White House.
OK, maybe not, but today we have a good example of why it’s still worthwhile. Earlier this week we posted a link to our animated explainer video on Wall Street Reform and asked what questions people had about it. Our group of 57,109 people has spurred a lot of great, involved discussions on issues like health care reform since we started up last year, and we got a lot of good questions this time too. Today Jen Psaki, our Deputy Communications Director (and one of our most prolific bloggers on this topic) stopped by to address some of the most common themes we saw in the discussion.
See all of her answers below – get connected to us to get in on the discussion next time, act fast and you could be lucky member number 57,110:
Answers to your questions on Wall Street Reform
Last week we asked for your questions on the recently-passed Wall Street Reform legislation. As usual, we’ve seen an interesting and insightful discussion here at LinkedIn, and we’re always grateful to get another snapshot of what the American people are thinking. We’ve looked through everything and I’ve posted responses to some of the key themes we saw from the conversation: http://linkd.in/cGHUE2
Nancy Brady: Who is The Bureau for Consumer Financial Protections responsible to?
The good news is that the Consumer Financial Protection Bureau (CFPB) is responsible to the American people. For far too long, the interests of consumers were represented by too many agencies and the purpose of the consumer bureau is to have one agency that stands up for consumers whether it is on mortgage contracts or overdraft fees, credit cards or the availability of simple financial information they need to make the best decisions for themselves and their families. The CFPB will be housed in the Federal Reserve, but it will have an independent director, an independent budget and independent rule-writing and enforcement authority.
Cherie Anderson: Why are we reforming Wall Street? They didn't cause the crisis.
Thanks Cherie. You are correct that all of Wall Street didn’t cause the crisis, but the irresponsible and reckless behavior of a few did contribute to the worst economic downturn since the Great Depression. The problem was Wall Street was not held accountable, large markets like the $600 trillion derivates industry grew and were left unregulated, and unfair and abusive practices in mortgages and other credit markets were left unchecked. The status quo was no longer sustainable.
We are working with the financial sector, including many businesses on Wall Street, to implement the financial reform legislation. The truth is putting new rules of the road in place is not only good for American families, it is also good for responsible businesses.
LaTisha Robinson: What is being defined here looks good. Although, as many people are saying, when does it really "trickle down" and help us?
This is one of the most important questions. There are many ways that this bill will help you LaTisha, and many Americans like you.
Here are a few examples:
Free Credit Scores: Far too many Americans are left scratching their heads when they are rejected for a loan or given a rate that is higher than they expected. Consumers will have a right to get a free credit score if they are turned down for credit or charged a significantly higher price than most other consumers because of their credit scores.
Unfair Mortgage Practices: As a result of the housing bubble, far too many Americans fell into loans that they could not afford. The Financial Reform bill provides strong, sensible protections for mortgages. It restricts a number of the unfair practices that fueled the housing bubble, including broker financial incentives to place borrowers in worse loans than they qualify for, prepayment penalties and lender pressure on appraisers. Lenders will not be able to make mortgages they know families cannot afford. The Consumer Financial Protection Bureau will also take steps to combine and simplify two overlapping Federal mortgage forms, and lessen the opportunity for brokers to use complicated forms to give borrowers loans they don’t need or enter into loans they can’t afford.
Overdraft Fees: The new CFPB will also enforce rules that give consumers a real choice of whether to join expensive overdraft programs. It will protect people like Andrew Giordano, a retired Vietnam veteran from Maryland who the President met last year. Andrew was saddled with hundreds of dollars in overdraft fees on his veteran’s account because his bank had automatically enrolled him in “overdraft” protection that he never asked for. The new CFPB will enforce new rules on overdraft programs to make sure that consumers like Andrew don’t get hit with these hidden fees.
John Nolan: Who "by name" are the people that will be controlling the Bureau?
The President has not made a decision yet about who will head the new Consumer Financial Protection Bureau, but there are a number of strong consumer advocates under consideration.
And in the mean time, we are doing everything possible to put as many important pieces of the bill in place as quickly as possible.
Mick Dalrymple: I have heard about limits on debit card interchange fees in the legislation. Does this include credit card fees?
This bill does impact debit cards. Merchants often pass these fees on to consumers and thanks to this law the fees will be limited to reasonable levels and merchants will be allowed to offer discounts for paying with debit cards rather than credit cards, since credit cards cost merchants more to process.