If an idea is so bad that it has to be massively modified even before it gets started, then it probably isn’t a good idea. That’s the case with Congressional efforts to create a law that would supposedly protect consumers from abusive or deceptive credit card and mortgage lending practices. Faced with objections that complying with regulators would be too burdensome, the House Financial Services Committee this week exempted 8,000 of the nation’s 8,200 banks from a requirement that their lending practices be examined annually by a new consumer protection agency. That’s a clear sign that the proposed law is so broken that Congress should start over from scratch.

The matter arises from unsavory mortgage and credit card practices that were a key part in creating the current recession. Besieged by demands that the government”do something,” House lawmakers made plans to create a new federal agency that would oversee consumer lending and, in theory, protect against the kind of disasters that have rocked our nation’s economy during the past two years.

Putting the matter in the government’s hands was a bad idea from the start. Because their first concern is always with getting re-elected, lawmakers looked for a splashy way to show that they were doing something big for their constituents – and what’s bigger than creating a whole new federal agency? Of course, federal regulatory agencies do a good job of preventing the same old things from happening again, using layer upon layer of bureaucracy to regulate businesses nearly to death. They are terrible at dealing with new and evolving problems. So the proposed consumer protection agency would probably have been no use at all.

The proposed agency would also have done nothing to support the idea that Americans ought to take some responsibility for their own decisions. The person who attempts to buy a $300,000 house on a $25,000 annual income should expect to soon be in deep financial trouble. It is not the government’s job to protect people from themselves.

Unfortunately, we appear headed for the worst possible combination: A big, expensive bureaucratic agency which will accomplish almost nothing. Lawmakers this week agreed that some 8,000 of the nation’s small, community banks should be exempt from annual examinations of their lending practices. The approximately 200 large banks – who serve, it should be noted, the vast majority of Americans – would still get annual examinations. But if the law is so poorly written that it can’t be applied equally to all financial institutions, it’s clearly way off track to begin with.

Congress will undoubtedly pass a bill that claims to provide consumer protection. It’s politically necessary. And it is even possible that some good might come of it. But the limited good is not going to outweigh the vast cost. Americans should expect better of their leaders.