The Situation of Creating a Consumer Financial Protection Bureau

In the wake of the worst economic crisis in the United States since the Great Depression, there has been a drive to reconfigure the regulatory state and renegotiate the relationship between Americans, business, and government.

In a new article, just posted on SSRN, I argue that the ultimate formulation of that relationship turns, to a significant degree, on our basic attributional tendencies, particularly where we look to assign causal responsibility when things go wrong.

Who or what engendered the shanty town that appeared in Sacramento, California in 2008?  Who blackened the pelican and closed the beach of Pensacola?  What lies behind the rise in diabetes in elementary school students?

The answers that we give drive our remedial responses and our prophylactic measures—and in doing so, define the interactions between our regulatory institutions, business entities, and members of the public.

If you believe that business causes—or, at least, significantly contributes to—a lot of these types of harms in society, then you are likely to want a government that gets tough and restrains corporations to protect the public.  If you think that business is largely blameless, then you are likely to be in favor of free markets with little or no regulation.

The Article begins by summarizing evidence from the mind sciences concerning our basic attributional framework, before investigating its value to business as a ready means to (1) manipulate our environments to encourage profitable consumer behavior and (2) avoid regulation and liability.

As a case study of the ways in which corporations play on our basic attributional proclivities to manage negative outcomes, the Article focuses on the intense – and often nasty — recent battle over the creation of the Bureau of Consumer Financial Protection.

Download a free copy of the article here!

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For a sample of related Situationist posts see “Attributional Divide – Top 10,” “Legal Academic Backlash – Abstract,” “Naïve Cynicism in Election 2008: Dispositionism v. Situationism?,” “The Great Attributional Divide – Abstract,” “The Situation of ‘Common Sense’,” “The Situation of Political Animals,” and “Naïve Cynicism in Election 2008: Dispositionism v. Situationism?”