H.R. 4173, which would implement significant reforms and improve consumer protection significantly, is on the floor of the House as we speak. Others will comment on the bill as a whole, but I want to draw attention to what is now one tiny little piece of that bill.
Congresswoman Niki Tsongas and her staff introduced a series of amendments related to credit scoring practices and the impact of asset limits in federal means-tested programs on the banking behavior of consumers. All three amendments have been included in the "Manager's Amendment" and are part of the legislation that the House will vote on (and likely pass) in the coming days. The assets limit amendment is a simple one, it directs a research unit within the new consumer protection agency to:
"research, analyze and report on: experiences of traditionally underserved consumers, including un-banked and under-banked consumers, regarding consumer financial products or services, and the impact of Federal policies, including resource limits in means-tested Federal benefit programs, on such consumers in influencing banking behavior."
This would mark a big step forward in understanding the reality faced by low-income Americans as they try to navigate the complex web of federal rules and programs that serve them. It also relates very closely to ideas put forward in "A Penny Saved is Mobility Earned," a new report from the Economic Mobility Project of the Pew Charitable Trusts. The report was co-authored by New America's Reid Cramer and Rourke O'Brien and includes a number of proposals to modernize Federal assistance programs to improve economic mobility for low-income Americans. The report was featured at an event on Capitol Hill and Rep. Tsongas' staff was in attendance. Clearly this is an issue that has been on their minds.
The first step toward solving a problem is better understanding it, and this little amendment should help make progress in doing that, once we have that information it should spur innovative policies to assist low-income Americans as they try to move up the ladder.
Congratulations are due to Rep. Tsongas on getting her amendments included in the bill, they're small amendments, but the impact could be big in the long run.
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