This column by Brian Johnson has been getting a great deal of attention since it was published Wednesday (as of today it is still the fifth most widely-shared piece on the Washington Times website). With all the other problematic stuff in the bill, I haven’t focused in detail on the various privacy issues that Johnson examines. As I read it, Johnson’s analysis appears to be accurate: the bill provides vast, vaguely-defined powers to regulators to monitor bank activities and, by extension, to monitor customers’ activities as well.
As with these privacy issues, the vast grants of power to federal regulators in the legislation pretty much amount to a blank check in terms of what is permitted. For example, the Senate version of the Bureau of Consumer Protection has only the loosest definition of what might constitute an “abusive” loan product–what might be swept under that heading is largely undefined (the term itself as it is used here seems to be novel). The House version is even worse–it leaves it up to the head of the agency/bureau to define its own powers in this regard.
Large swaths of the bill amount to “trust me” grants of power to the federal government. While that seems highly problematic in general, one would think we’d be especially concerned about making open-ended “trust me” grants of power when it touches on privacy concerns.