Liberals Push for New Consumer Cop as Part of Financial Reform Bill

A dispute over whether to create a new consumer protection agency has stalled the latest attempt to win Senate approval for a financial reform bill establishing stronger government oversight of Wall Street.

The Obama administration and Senate Banking Committee Chairman Chris Dodd (R-Conn.) have backed off of demands for creation of a new stand-alone agency, but liberal lawmakers and consumer advocates still insist one is needed to guard against abuses involving credit cards, mortgages and other loans, the Washington Post said Friday.

Dodd now favors setting up a consumer bureau within an existing agency as part of the legislation to strengthen government's hand and clarify lines of responsibility in the regulation of the financial industry. The House passed its version in December but the Senate bill has been snagged by a series of disputes. Dodd planned to unveil a slimmed down measure next week.

The U.S. Public Interest Research Group and other consumer advocates are still pressing for a brand-new agency with its own budget and a boss who would not have to answer to other government bureaucrats. "We are looking for an independent agency, not something that is subservient to any other regulator, any other person," said Ed Mierzwinski, consumer program director for U.S. PIRG.