Later On

A blog written for those whose interests more or less match mine.

Mr. Trump Goes After Consumer Financial Protection Bureau

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The GOP has never, so far as I know, shown the slightest interest in protecting consumers. The GOP is to protect and assist corporations (thus the gutting of the EPA, which is certainly going to harm the public but will be a boon to corporate profits). The editors of the NY Times write:

Shortly after Inauguration Day, the Trump camp indicated it had no immediate plan to fire Richard Cordray, the Obama-appointed director of the Consumer Financial Protection Bureau, whose term runs until July 2018. The administration’s restraint was a welcome contrast to congressional Republicans’ unrelenting efforts to weaken the bureau, including calls to get rid of Mr. Cordray, an effective leader, on the ground that he had become a dictator.

Last week, however, the administration signaled it wanted to fire Mr. Cordray. Specifically, the Justice Department weighed in on a pending case in federal court that will decide how much power a president has to fire the bureau’s director. In its filing, the Justice Department has asserted that the director should be removable at the president’s will. That stance is consistent with an earlier 2-to-1 ruling by a panel of the United States Court of Appeals for the District of Columbia Circuit, but it is inconsistent with the Dodd-Frank financial reform law that created the bureau in 2010 and that says the director can be fired only for cause, defined as “inefficiency, neglect of duty or malfeasance.”

None of those criteria remotely describe Mr. Cordray’s work or the consumer bureau he helped to build. In the past five years, the bureau’s investigations and enforcement actions against banks and other lenders have returned nearly $12 billion to homeowners, students, servicemen and servicewomen, car buyers, credit card holders and other borrowers who were subject to abusive, deceptive or predatory practices. The bureau is now working on ways to regulate payday lending, where loans often end up impoverishing borrowers.

Mr. Cordray and the bureau have been doing what President Trump pledged to do in the campaign: protecting Americans from a system that has “robbed our working class.” So why would he want to fire Mr. Cordray? For one, Mr. Trump, despite his populist claims, has promised to dismantle the Dodd-Frank law, with the consumer bureau arguably the law’s most visible accomplishment. Second, the move may be part of a bigger power play.

Mr. Cordray is not the only agency head with statutory protections from removal at will by the president. The heads of the Office of Special Counsel, the Social Security Administration, the Federal Housing Finance Agency, the Federal Reserve, the Nuclear Regulatory Commission, the Consumer Product Safety Commission and other agencies are also shielded. Such protection is intended to insulate independent agencies from political interference.

But even if the full appeals court, which is hearing the case, rules that . . .

Continue reading.

Written by LeisureGuy

22 March 2017 at 12:18 pm

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