White House Pushing to Allow Debt Collectors to Call Cell Phones over Federal Debt

President Obama may be butting heads with his own party soon, at least in his efforts to make it easier for private debt collection companies to call debtors' cell phones in some cases involving things like student loans, delinquent federal taxes and other billions owed the federal government.

The debt collection industry has been clamoring for it as of late, particularly because of the increasing number of people – mostly younger people – who rely solely on cell phones and are therefore unreachable on land lines, according to the Associated Press (News - Alert).

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 White House wrote recently.

The change in rules would apply only to money owed to the federal government. The language endorsing the change is part of the President's $3 trillion deficit-reduction plan recently submitted to Congress.

Not everybody is happy about the proposal, particularly at a time when complaints against private debt collectors have never been higher. The Federal Trade Commission has said that it receives more complaints against the debt collection industry than any other specific industry: more than 100,000 in 2010 alone.

“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 National Consumer Law Center. “People aren't paying their student loans because they can't find a job.”

Top Democrats are rumored to be unhappy about the proposal as well, though none have gone on record opposing it – yet. For its part, the debt collection industry is clamoring to be allowed to call cell phones in cases of all debt, not just money owed the federal government.