(CNSNews.com) – Rep. Barney Frank (D-Mass.) told CNSNews.com Thursday that, if it were up to him, Americans would be completely free to smoke marijuana and gamble on the Internet -- but they shouldn’t be allowed “total freedom” in their financial decisions because those risky decisions might adversely affect others.
“I would let people gamble on the Internet,” Frank said. “I would let adults smoke marijuana; I would let adults do a lot of things, if they choose.”
He added: “But allowing them total freedom to take on economic obligations that spill over into the broader society, or have a house in a neighborhood -- which when they go bankrupt becomes a fire hazard for their neighbors -- we're well beyond, the impact goes well beyond the individual."
"The individual is not the only one impacted here," said Frank, "when bad decisions get made in the economic sphere, it causes problems.”
CNSNews.com asked Frank, the chairman of the House Financial Services Committee, to respond to criticism from his Republican counterpart on the committee, Rep. Spencer Bachus (R-Ala.), during a hearing Thursday on the Mortgage Reform and Anti-Predatory Lending Act of 2009.
Bachus had questioned the bill’s premise--imposing tough new federal regulations on subprime and other “high risk” mortgage lending.
“If you can’t afford it, don’t buy it,” Bachus had said Thursday during a committee hearing on the bill, referring to people who bought adjustable-rate (ARMs) and other expensive mortgages. “You’re substituting the government’s decision for the individual’s decision in whether they can afford it.”
CNSNews.com asked Frank if Bachus was right--whether Frank’s proposal might undercut personal responsibility and the freedom of individuals to make decisions.
“We’re not just talking individual responsibility,” Rep. Frank said. “We have a world-wide economic crisis now because of this. If it's purely individual responsibility, okay, that’s why I disagree with the ranking member.”
Frank explained that he believed individuals should be allowed to smoke pot and gamble on the Internet, but “total freedom” in financial decisions might “cause problems.”
Frank said he mentioned gambling because Bachus is an open opponent of Internet gambling. Bachus did not comment to CNSNews.com for this story.
Frank’s bill, H.R. 1728, also came in for criticism from some advocates for low-income borrowers, who say it would place restrictions on banks that would only make things more confusing by adding additional federal regulations on top of existing state laws.
During testimony, Margot Saunders, legal counsel for the National Consumer Law Center, told members of the committee that the bill would circumvent key state laws already in place and make the legal framework too complex for low-income Americans to navigate.
“The bill is complex, convoluted and simply will not accomplish its main goal - to fundamentally change the way mortgages are made in this country,” Saunders said.
“This provision is so onerous and potentially harmful to low-income homeowners saddled with predatory mortgages or struggling to avoid foreclosure that we must oppose this bill, despite its promise of additional funding to legal services offices and some other positive provisions," she added.
The Massachusetts congressman, meanwhile, disputed these points, too, saying that while the bill doesn’t preempt states’ ability to regulate mortgage lenders, it wouldn’t have been necessary had they actually done so.
“This bill has very little preemption in it," Rep. Frank told CNSNews.com. “It leaves the states alone .... Although I will say the states have, if the states could do a good job, we probably wouldn't have this crisis. And the states have not done a good job on banks.”
The bill, the Mortgage Reform and Anti-Predatory Lending Act of 2009, is sponsored by Reps. Brad Miller (D-N.C.), Mel Watt (D-N.C.) and Frank. It will go for mark up on April 28.