Embracing proposed new rules aimed at payday lenders, President Barack Obama on Thursday warned Republicans that he would veto attempts to unravel regulations that govern the financial industry.
Obama, in excerpts of remarks for delivery later Thursday, praised the Consumer Financial Protection Bureau for its proposal to set standards on a multibillion-dollar industry that has historically been regulated only at the state level.
“As Americans, we believe there’s nothing wrong with making a profit,” Obama says, according to the excerpts. “But if you’re making that profit by trapping hard-working Americans in a vicious cycle of debt, then you need to find a new way of doing business.”
Obama’s remarks come on the same day the consumer agency was announcing the proposed payday-lending rules in a hearing in Richmond, Va. Payday loans provide cash to borrowers who run out of money between paychecks. The short-term loans carry high interest rates.
The rule would require lenders to make sure that borrowers can afford to pay the money back.
Obama says the Republican budget, a version of which just passed the House of Representatives, would make it harder for the Consumer Financial Protection Bureau to do its job. The budget is a nonbinding measure that serves as a blueprint for ensuing legislation.
“If Republicans in Congress send me a bill to unravel Wall Street reform, I will veto it,” he said.
Obama also is using his speech in Alabama for a broader attack on the Republican budget. He said Republicans aim to cut taxes for wealthy individuals.
“I don’t think our top economic priority should be helping a tiny number of Americans who are already doing extraordinarily well, and asking everybody else to foot the bill,” he said.