WASHINGTON - September 9 - "In the long run, one of the most important privacy actions taken by the Obama administration may be one that hardly mentions privacy, if at all.

"The Obama proposal to establish a Consumer Financial Protection Agency takes the giant step of proposing that federal consumer banking law return to its roots as a floor or a minimum standard of protection, not a ceiling, reinstating the long-eviscerated rights of the states to enact stronger consumer banking and credit laws.

"If we can defend this proposal against the phalanx of corporate lobbyists against it, it is a game-changer.

"The states have always been privacy champions while Congress and federal agencies have routinely befriended corporate privacy opponents, on issues ranging from medical privacy to financial privacy to identity theft, where preemption has been the rule, not the exception.

"Yet, where we have blocked preemption, we have had great success. As just one example, in 2003, Congress failed to provide adequate identity theft protection as part of its FACT Act amendments to the Fair Credit Reporting Act. For once, advocates were able to convince Congress to keep a narrow window open for further state actions, against tremendous industry pressure to totally preempt all future state actions in credit reporting. Since 2003, fully 46 states and DC have joined California in enacting comprehensive, largely outstanding security freeze protections against identity theft. Unlike industry propaganda claims, these laws have converged toward one law, not created 46 balkanized laws. Compliance is easy.

"So long as federal laws are strong enough, there is no need for the states to act in any balkanized way, and they have not and will not. That's not rational. But if federal laws fail to do the job, we need to protect the right of the states as first responders-- their rights to act should never be taken off the board by the demands of corporate privacy invaders for weak, uniform and preemptive federal laws. That's not rational.

"Congress has just returned for another semester. We urge it reject the demands of special interests and remember that the states have always been the privacy and consumer protection leaders. U.S. PIRG looks forward to ranking the Congress on its upcoming actions regarding this critical Obama proposal to allow states to enact stronger state privacy and consumer laws. We also anticipate Congressional preemption fights over security breach, Internet, medical and other privacy legislation. For now, we give the Obama administration an A on its critical pro-privacy, pro-state authority to enact stronger laws proposal. We're watching the Congress."