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AFR Statement: Budget Takes Aim at CFPB and Student Loan Holders

Submitted by on May 23, 2017 – 10:52 am
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Americans for Financial Reform deplores the decision in the President’s budget to try to defund the Consumer Financial Protection Bureau and end the Public Service Loan Forgiveness program.

The loan forgiveness program was signed into law in the George W. Bush administration. It provides for cancellation of federal student loans after ten years of on-time payments for those working at public institutions or 501c(3) nonprofit organizations.

“At a time when researchers have raised alarms about the negative impact of the high levels of student debt on the broader economy, the department should be working to expand opportunities for debt relief, not eliminating them,” said Alexis Goldstein, senior policy analyst at AFR. “The decision to end this program is not just ill-conceived policy, it is a cruel decision that will impact millions of borrowers previously eligible for this program. We call on Congress to reject this proposal.

Likewise, the Consumer Financial Protection Bureau has been a success that Congress should not disrupt.

“Without exception, the proposals we’ve seen to de-fund or restructure the Consumer Financial Protection Bureau are about making it less effective at doing its job,” said Brian Marshall, policy counsel at AFR. “The agency has won relief worth $12 billion for 29 million Americans since it started work. All these proposed changes to the CFPB would do is make it easier for Wall Street and assorted predatory lenders to rip people off.”

AFR likewise opposes efforts to dismantle the Orderly Liquidation Authority that gives regulators the power to wind down, rather than bail out, big banks:

“In any case, it is profoundly shortsighted and foolish to cut back on protections against financial meltdowns that create trillions in costs to the government in order to claim small temporary savings,” said Marcus Stanley, policy director at AFR.

Stanley added that the administration has eliminated funding for Community Development Financial Institutions and cuts money for the Small Business Administration, despite claiming to support small businesses.

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