Truth in Lending Theory, History, and a Way Forward

• No other work focuses comprehensively on the economic, behavioral, and legal aspects of Truth in Lending or other federal financial consumer protection measures. Other sources are either solely legal in their orientation (for example, case books) or are statements of advocates of one regulatory position or another (for example, testimony and lobbying materials).
• The entire book concerns an ongoing public policy debate about the efficacy of financial disclosures as consumer protections. This debate began as long as 1960 with Congressional introduction of the original Consumer Credit Labeling Bill, now evolved into the massive federal financial disclosure regimes. Congress has amended Truth in Lending twenty five times since passage in 1968 and no year goes by without discussion of further amendments.

This book is a guide to the purposes, strengths, and weaknesses of disclosures as consumer protections in financial transactions such as loans, deposits, and consumer leases. It focuses on the federal Truth in Lending Act but also covers a variety of other federal disclosure statutes designed to protect consumers in their financial relationships. It comes at a time when federal financial consumer protection policy in the financial area is again a matter of intense public scrutiny and debate.

Because of the importance of public policy issues surrounding use of disclosures as consumer protections, the intended audience includes anyone interested in these issues, not simply specialists who spend their time focused on them. For this reason, the work avoids academic jargon and the mathematics that is the modern language of economics. It also examines the psychological, sociological, historical, and especially legal traditions that go into fully understanding what has led to the demand for better disclosures for consumers and to what they have become today. Despite a need to outline and review prior difficulties with disclosure laws, the book remains optimistic that disclosures will continue to be an important means of consumer protection and that future reforms can improve their effectiveness and lower their regulatory costs and burden.

Readership: The public policy community, especially in Washington; the academic community in economics, finance, marketing, and law; the financial services industry including banks and other financial institutions; students in law, public policy, and consumer protection; lay members of the public interested in public policy debates in the financial or consumer protection areas.