Crisis Prevention
Serve the People Right ublic serv ice is in the Udall family blood. Before his election to the US Senate from New Mexico in 2008, Tom Udall served two decades as the state’s attorney general and a US representative. His father, Stewart, was the Secretary of the Interior in the cabinets of presidents John F. Kennedy and Lyndon Johnson. His uncle Morris was a congressman from Arizona for three decades. And he has first and second cousins currently serving in the Senate. It is difficult to imagine a more appropriate public servant to have delivered the 16th annual Attorney General Robert Abrams Public Service Lecture last September. In his lecture, Udall focused on how he addressed two public safety issues when he was attorney general: drunk driving and smoking. When he took office in 1991, New Mexico was first in the nation in drunk driving deaths, he said. Udall made the issue a priority in his campaign and during his first years in office. After creating a task force, consulting interest groups, and lobbying legislators, however, his efforts gained traction only, he admitted, after a woman who lost her grandchildren in a drunk driving accident spoke out about the issue, leading to the passage of comprehensive state legislation that cut the number of yearly drunk driving deaths in half. Udall also played a role in a lawsuit against the tobacco industry brought by 46 state attorneys general alleging that several major tobacco companies misled the
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public, enhanced addictive properties of cigarettes, and marketed their products to children. Udall said that in 1997, New Mexico alone spent $26 million in Medicaid costs for residents suffering from smoking-related illness. The tobacco companies settled for a historic $206 billion. Udall noted that the attorneys general working in concert were better able to address the problem than the federal government because they were not as beholden to tobacco industry political funding. Peppered throughout his lecture were observations on the value and benefits, both to oneself and the nation, of public service. At the outset of his speech, Udall wryly noted the difficulty in encouraging public service at a time when Congress’s approval rating (nine percent) rested just below that of the Communist Party (11 percent). And he quoted the philosopher Albert Schweitzer: “The only ones among you who will be truly happy are those who will have sought and found how to serve.” While talking about his work as attorney general Udall stressed the importance of the unelected staff, acknowledging the impossibility of facing down complex policy problems without their talent and passion. “The people are what you come back to,” he said. “Many of them were hardworking lawyers who made a big difference on real issues.” Emphasizing that the stakes are no less than the future of the nation, Udall quoted his father: “If the good people don’t go into public service, the scoundrels will take over.”
meredith fuchs ’93, general counsel of the Consumer Financial Protection Bureau (CFPB), gave the annual Frank J. Guarini Government Lecture at NYU Law in January. Fuchs, who joined the CFPB when the bureau was established by the Dodd-Frank Act in 2010, spoke about the bureau’s evolution from a group of 10 people “in the basement of the Treasury Department” to an agency of more than a thousand people, and discussed the actions that the bureau has taken to protect consumers in the aftermath of the financial crisis. “This financial crisis reminded us in a very, very hard way that unregulated or poorly regulated financial markets can affect not only the welfare of individuals, not only the welfare of specific financial firms that make poor choices, but the stability of the economy itself,” Fuchs said. “The bureau was created, among other reasons, to try to prevent this from ever happening again.” Because irresponsible underwriting of mortgages was the principal cause of the financial crisis, the most significant task that the CFPB has taken on so far is the regulation of the mortgage market— the single biggest market for consumer finances. The CFPB was tasked with regulating to end the problematic practices of mortgage service providers, such as the use of robo-signed affidavits in foreclosure proceedings, deceptive practices in the offering of loan modifications, and the failure to process homeowners’ requests for modifications of payment plans. The bureau recently issued its first set of mortgage-servicing rules, which are intended to “help prevent borrowers from being caught off guard by surprises, and provide special protections for borrowers who are having trouble making their mortgage payments,” Fuchs said.