The Common Good

A Moral Mandate for Financial Reform

After all the financial turmoil that 2009 has already brought, one would think that it would somehow be logical and practical to bring accountable reforms to the same banking institutions whose reckless practices brought about our current recession. Unfortunately, that needed effort is anything but easy.

This week, Congress will take its first vote on financial reform. Amidst the discussion of derivatives, credit ratings, and systemic risk, there is an important step that the administration has proposed to deal with family finances: the creation of a Consumer Finance Protection Agency (CFPA). CFPA would oversee home loans, credit cards and other financial services, ensuring that loans would be offered on terms that borrowers can repay and the true costs of credit appear in easily understood terms.

CFPA would address the very abuses that are at the heart of our current crisis -- high cost and unsustainable home loans that were extended without concern for a family's ability to pay them back (and often to low and moderate income borrowers who could least afford them). CFPA would also bring under federal oversight fringe financial services like payday and car title loans that often mean a debt trap for families.

Right now, banking industry lobbyists are doing their best to thwart congressional discussions on CFPA. To get the real reform we need, all of us will need to be just as engaged.

As Christians, we have particular wisdom to share in this debate. The Bible commends those who lend justly and generously (Psalm 112:5), while opposing lending that oppresses those who are poor. Fair lending practices and the protection if the vulnerable are seen as the hallmarks of a just society (Exodus 22:25-26; Leviticus 25).

Religious leaders like Catholic Cardinal Theodore McCarrick were among the first to sound an alarm about unsustainable and predatory mortgage lending to low-income and vulnerable communities. He called these practices usurious and "morally illicit."

As Congress undertakes financial reform, they need your wisdom and values.

In defense of our most vulnerable people, ask Congress to support reform that restores integrity and justice to our financial system.

Reform won't be easy after all; but it will become more likely if we speak up NOW.

Rachel Hope Anderson works at the Center for Responsible Lending. You can follow her writing about faith, debt and lending on twitter and read more on predatory lending and the financial crisis here.

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