One of the problems with delaying implementation of the various regulatory reforms that are being proposed is that financial services companies are given ample time to get back to their old tricks. For instance, as executive compensation reforms stall in the Senate, Wall Street pay is heading back to pre-crisis levels.

And the same holds true in terms of consumer protection. House Financial Services Committee Chairman Barney Frank (D-MA) has had to push back work on legislation creating a new Consumer Financial Protection Agency (CFPA), thanks to Republican and industry intransigence. And as BusinessWeek reported, “already some of the world’s biggest banks are peddling a new generation of dicey products to corporations, consumers, and investors”:

In recent months such big banks as Bank of America (BAC), Citigroup (C), and JPMorgan Chase (JPM) have rolled out newfangled corporate credit lines tied to complicated and volatile derivatives. Others, including Wells Fargo (WFC) and Fifth Third (FITB), are offering payday-loan programs aimed at cash-strapped consumers. Still others are marketing new, potentially risky “structured notes” to small investors…[I]t’s another scenario that worries regulators, lawmakers, and consumer advocates: that banks once again are making dangerous loans to borrowers who can’t repay them and selling toxic investments to investors who don’t understand the risks — all of which could cause blowups in the banking sector and weigh on the economy.

All of these banks, incidentally, received TARP money. For Wells Fargo, this is especially pernicious, as it is already being investigated for intentionally pushing minorities who qualified for prime loans into subprime.

The CFPA proposal is currently under siege on multiple fronts. Republicans are teaming up with the financial services industry to coordinate anti-CFPA messaging and events over the August recess, while regulators from already existing agencies are engaged in a turf battle with Treasury Secretary Tim Geithner over the new agency’s creation. Comptroller of the Currency John Dugan — “who faces the loss of some of his powers if the plan is implemented” — has been deriding the CFPA because it “would make it more difficult and costly for large lenders to operate across the country.”

As we’ve seen, the current regulatory framework simply doesn’t provide adequate protection to consumers. And while Congress dithers, the banks are getting back to business as usual.

Today, the Senate is planning to vote on infusing another $2 billion into the “cash for clunkers” program, after the program proved more popular than expected and went through its initial $1 billion in funding in just six days. However, the popularity of the program — and its positive economic and environmental benefits — has not swayed some Republicans from treating it “like swine flu with a steering wheel.”

Foremost among these has been Sen. Jim DeMint (R-SC), who appeared on CNBC this morning to deride the “centrally planned economic scheme we’re working on here.” And even when presented with the argument that cash for clunkers will successfully provide economic stimulus along with environmental benefits — which is exactly the point — DeMint retorted “it’s still a horrible policy.” Watch it:

Here are some of the things that DeMint evidently finds “horrible.” According to analysts at Action Economics, the boost in consumption thanks to cash for clunkers will cause “third quarter GDP to grow 1.8% rather than his previous forecast of 1%.” Thanks in part to the program, auto sales in July rose to an annualized pace of 11.3 million units, the highest since September 2008. And as the Associated Press reported, “if the Senate approves the additional money, it’s likely to lead automakers to increase production and bring back laid-off workers.”

And then there are the environmental benefits. The Department of Transportation reported that “the average fuel efficiency of old cars traded in via the program is 15.8 miles per gallon, while new cars had an average MPG of 25.4.” As the Economic Policy Institute found:

On average, total gas consumption will drop by 87 million gallons per year, and American consumers will use 22.2 million fewer barrels of foreign crude oil. The environmental impact of reduced gas consumption is considerable as well. We estimate that the program will result in about 850,000 fewer tons of CO2 emissions per year (3.4 tons per vehicle annually).

This program is definitely not the most efficient way to stimulate the economy or reduce emissions, if either was the program’s sole purpose. But cash for clunkers is worthwhile because it does both, which DeMint clearly finds objectionable.