We've joined a number of public interest, civil rights and housing organizations in support of a petition for appellate review of the decision in Cuomo v. Clearinghouse Association and OCC. In previous decisions, the court held that even in circumstances where the federal Office of the Comptroller of the Currency (OCC) recognized that national banks still had to comply with state fair housing and consumer laws, that only it (the OCC), not state attorneys general or bank supervisors, could enforce those state laws.

The 2004 decision by the Office of the Comptroller of the Currency to displace states’ longstanding enforcement power with respect to state consumer protection and anti-discrimination laws severely disrupts states’ traditional law enforcement regimes. It directly contravenes this Court’s precedents and turns a fundamental principle of federalism on its head. The notion that valid and binding state laws may be enforced only by the national government is both perplexing and contrary to principles of federalism embedded within the Constitution.

In his story U.S. Shifts Focus in Credit Bailout to the Consumer on Treasury Secretary Paulson's announcement that the government was shifting its bailout strategy to promote credit card and other consumer lending, Edmund Andrews of the New York Times points out that (1) "Fed officials appeared to be taken aback" [at the public announcement], (2) "taxpayers would be indirectly liable for the entire volume of lending" and (3) [the] "arrangement would bear a similarity to exactly the highly leveraged, and eventually disastrous, special-investment vehicles that banks like Citigroup created in countless numbers to hold, among other things, securities backed by subprime mortgages."

Paulson's spin is that the new program will directly help consumers. His old plan was supposed to help consumers, too, but that plan to buy bad assets only helped institutions, because they took the taxpayer money and ran. They didn't follow through and lend with the new money as they were supposed to. The money in the new plan is still going to banks but supposedly can only be used to help promote, leverage and securitize new lending. We'll see how Plan B goes, if it is actually implemented, since it appears that the Fed may not yet be fully on board. Meanwhile, Paulson still has no plans to help consumers, such as those in foreclosure, directly.