Skip to Content
Streetsblog USA home
Log In
Cars

How Car Dealers Wiggled Out of the Democrats’ Consumer Protection Bill

2:20 PM EST on December 30, 2009

Auto loans and leases account for a major chunk of the U.S. financial market -- one nonpartisan research group recently pegged American car debt at $850 billion, larger than the entire credit-card industry. So perhaps it shouldn't be surprising that car dealers' lobbied themselves an exemption from the new consumer watchdog included in the House financial reform bill that cleared the House earlier this month.

new_car_dealers.jpg(Photo: AmericaJR.com)

But how did the loophole for auto dealers sail through the House Financial Services Committee, winning by a margin of more than 2 to 1 despite the opposition of panel chairman Barney Frank (D-MA)? An excellent piece by two of the Huffington Post's political reporters offers a frustrating answer to that question:

[G]roups like the auto dealers don't bring with them to Capitol Hill thepublic-relations baggage of Wall Street or Goldman Sachs. "The localauto dealers are very popular in their districts," Frank says. The morean interest group can make an issue district-specific and the more itcan relate on an everyday level, Frank argues, the better it will do. ...

"What's happening now is the pro-regulation forces are beingout-grassroots-ed by the antis," Frank says. One member, he says,represented tons of title insurance companies. Another came from theheadquarters of credit unions. A third's district is home toLexisNexis; another to Equifax. Each of those entities received specialtreatment because their representative sits on the committee -- and themore members on the committee, the more special treatment is needed. "Ihave not had a problem because of campaign contributions. The problemis democracy: it's people responding to people in their districts:community bankers, realtors, auto dealers, as I said, end users,insurance agents," says Frank.

For the HuffPost, the auto-dealer victory serves as a window into a broken legislative system dominated by lobbyists' priorities and lawmakers' re-election concers. But the dealers' loophole also serves as a warning for environmental groups, sustainable transportation advocates, and any voter who wants to see emissions caps and fuel-efficiency rules remain as strong as possible.

Without an aggressive, coordinated strategy to avoid being "out-grassroots-ed" by polluting industries, as Frank put it, the forces of reform are likely to watch more exemptions be carved out as the legislative process moves forward. Auto dealer groups were unafraid to take credit for their ability to muscle Congress; one wonders if their clean-transport counterparts can do the same.

Stay in touch

Sign up for our free newsletter

More from Streetsblog USA

Car Noise Pollution is Worse in Redlined Neighborhoods — And Not Just for Humans

Transportation noise pollution can wreak havoc on wildlife populations, too — and that can have a devastating effect on their human neighbors.

December 6, 2023

Oakland Calif. Mayor Makes New Promise About Safety

Mayor Thao Tweets "It's time to reach a critical juncture where tragedies don’t catalyze improvements." But when and how will we know if the city has really reached that point and is serious about safety for all road users?

December 5, 2023

Wednesday’s Headlines Envy Europe

Could the EU keep U.S. megacars off their streets?

December 5, 2023

Tuesday’s Headlines Are Getting Warmer

EVs and renewables are not going to be enough to stave off a climate catastrophe, scientists are warning officials at an international conference.

December 5, 2023
See all posts