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Obama Proposes Allowing Debt Collectors to Robo-Call Cell Phones

By Doug Powers  •  October 4, 2011 04:55 PM

**Written by Doug Powers

This is purportedly an attempt to increase revenue, but the proposed debt collector stimulus would only apply to the collection of government loans:

WASHINGTON (AP) — To the dismay of consumer groups and the discomfort of Democrats, President Barack Obama wants Congress to make it easier for private debt collectors to call the cellphones of consumers delinquent on student loans and other billions owed the federal government.

The change “is expected to provide substantial increases in collections, particularly as an increasing share of households no longer have landlines and rely instead on cellphones,” the administration wrote recently. The little-noticed recommendation would apply only to cases in which money is owed the government, and is tucked into the mammoth $3 trillion deficit-reduction plan the president submitted to Congress.

Despite the claim, the administration has not yet developed an estimate of how much the government would collect, and critics reject the logic behind the recommendation.

“Enabling robo-calls (to cellphones) is just going to lead to more harassment and abuse, and it’s not going to help the government collect more money,” said Lauren Saunders of the Boston-based National Consumer Law Center. “People aren’t paying their student loans because they can’t find a job.”
While Carney didn’t say so, debt collection agencies are already permitted to call cell phones. The administration wants the law changed so the firms can use robo-calling.

I could try to get back over $500 million of that with one call… what’s Solyndra’s cell phone number?

When President Obama announced the formation of the Consumer Protection Agency, he said “never again will folks be confused or misled by pages of barely understandable fine print that you find in agreements for credit cards or mortgages or student loans.” For more on the Obama’s debt collection ideas, consult the barely understandable fine print on page 28 of The President’s Plan for Economic Growth and Deficit Reduction.

That reminds me of a variation of Johnny Carson’s pitchman character Art Fern: “Can’t make your car payment? We don’t care. Can’t pay your Visa bill? They’re just screwing you anyway, we don’t care. Defaulting on your mortgage? We don’t care. Not gonna pay back the government? ::WHAP!:: Then we care!”

**Written by Doug Powers

Twitter @ThePowersThatBe

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