Anti-Safety Highway Bill Heading to President

Congress is working to finalize a highway reauthorization bill by November 20, 2015, when the current highway authorization bill expires.  The House passed their version of the DRIVE Act (H.R. 22) last Thursday and needs to work out the differences with the Senate’s version to get it to the President. Considered by consumer and safety advocates to be the most anti-safety highway reauthorization bill ever, negotiations are now underway to reconcile the two versions.

“Congress is crashing at every turn on the road to improving auto safety.  Republican leadership has failed to hold auto industry executives accountable for their decisions, failed to give NHTSA the essential legal and financial tools needed to fulfill its mission, and failed by putting trucking profits ahead of truck safety,” said CFA’s Director of Public Affairs Jack Gillis in a press release. “What is particularly tragic is that in the face of record numbers of recalls, serious safety defects that have been uncovered and acknowledged, Congress is choosing to ignore the plight of the vast number of the car buyers who can only afford to buy used cars and not require that recalled problems be fixed before the cars are sold.”

Sen. Edward Markey (D-MA) and Sen. Richard Blumenthal (D-CT) are working with consumer and safety advocates to identify the specific changes that must be made to fix the bill. “What is particularly tragic is that these Senators have identified problems that can be solved, while the majority in Congress drags their feet,” said Gillis.

CFA Applauds Ban on Overdraft Fees for Student Accounts

The Department of Education has announced new regulations which will add new consumer protections to bank accounts and prepaid cards used to access student loans. The new rule prohibits overdraft fees and transaction swipe fees for bank or prepaid card accounts offered by academic institutions or any contractors that work with them. It also prohibits academic institutions from requiring students or parents to open an account at a specific institution that may have a financial relationship with their school to receive student aid refunds.

CFA issued a statement supporting the new rules, noting that these new protections will ensure that students can access their student loan proceeds without incurring confusing or excessive fees and will improve student choice when selecting a bank account in which to deposit the proceeds of their loan. “High and variable back-end fees such as overdraft fees shroud the total cost of basic banking services at the very time students need a transparent, low-cost account,” said CFA Director of Financial Services Tom Feltner. “Due to the Department of Education’s effective regulation, overdraft and confusing fees will be eliminated. This will ensure that much-needed financial resources go where they are most needed – to supporting a successful academic career.”

Broad Coalition Opposes Funding Bill with Financial Policy Riders

166 organizations, including CFA, have called on members of Congress to oppose any funding bill which would roll back or undermine financial reforms which have been adopted since the economic meltdown of 2008. While everyday Americans are still recovering from the effects of the crisis, reforms have been put in place that have begun to protect consumers and reduce the risk of another catastrophe.

“Among the shining examples of that reform has been the Consumer Financial Protection Bureau (CFPB), whose enforcement activity has secured $11 billion in relief for 25 million consumers,” the groups wrote. “In addition, the reforms of the Wall Street Reform and Consumer Protection Act (Dodd-Frank) have begun to protect consumers and reduce the systemic risks that led to the last crisis. And the Department of Labor (DOL) has proposed a conflict-of-interest rule intended to protect Americans against conflicted investment advice that can lose workers and retirees tens or even hundreds of thousands of dollars over time.”

Despite these positive developments, some members of Congress are nonetheless attempting to use the appropriations process to roll back these actions, putting the public interest at risk to deliver a wish list to narrow Wall Street interests. They are trying to undermine key financial reforms through “policy riders” that slip controversial policy changes into must-pass funding legislation. All this despite the fact that two-thirds of likely voters believe that we need more regulation of the financial industry, not less.

“With many of the reforms since the crisis resulting in relief for consumers nationwide, CFA believes that any attempt to undermine the CFPB, the Dodd-Frank Act, the DOL’s conflict-of-interest rule, or other financial reform legislation or regulations would be a serious misstep, and thus opposes any attempt to change these regulations through financial policy riders,” said CFA Legislative Director Rachel Weintraub.

Nearly One-Third of Americans Willing to Buy Electric Car

A survey released last month by CFA found that most Americans (54 percent) have a positive view of electric vehicles (EVs) and almost one-third (31 percent) said they will consider buying an EV in their next car purchase. The survey also revealed that the more Americans know about EVs, the more likely they are to consider this purchase. However, only a little over a quarter of respondents say they know a great deal (6 percent) or a fair amount (21 percent) about EVs at this early stage of EV marketing and sales.

“Our research shows a clear, statistically significant correlation between knowledge about EVs and positive attitudes towards EVs. The more one knows about EVs, the more positively one feels about these vehicles,” said CFA Research Director Mark Cooper. “Furthermore, there is a statistically significant correlation between positive attitudes about EVs and a willingness to purchase them—those who feel positively about EVs are more likely to consider purchasing one.”

“While the current market penetration of EVs is small, there are currently 12 automakers currently offering a wide variety of EVs, so these consumers already have choices,” said CFA Director of Public Affairs Jack Gillis, author of The Car Book and the new Snapshot Guide to Electric Vehicles. “As the auto and tech industries pour millions and millions into the refinement of EVs, the American consumer is poised to bring those EVs home and plug them in,” Gillis said.