Wall Street interests have been trying to undermine the Consumer Financial Protection Bureau ever since they failed to block its creation. This week, they mounted a major effort to win bipartisan support for yet another piece of legislation intended to hamstring the Consumer Bureau – this time around, a bill to change the Bureau’s leadership structure, putting it under a five-member commission instead of a single director.
Backers of the “Financial Product Safety Commission Act” (H.R. 1266) told some whoppers. Writing in The Hill newspaper, a group of industry lobbyists invoked the names of Senator Elizabeth Warren and former Representatives Barney Frank and Brad Miller as supposed supporters of the commission idea, despite the fact that all three have clearly said the opposite.
Fortunately, consumer advocates and their allies in Congress fought back. Representatives Maxine Waters (D-Calif.) and Al Green (D-Tex.), among others, spoke up forcefully in defense of the Consumer Bureau and the single-director model. The Office of Comptroller of the Currency, Rep. Green pointed out, has functioned with a single director since 1863, and there have been no calls from Congress to change that arrangement. The White House, in a blog post by National Economic Council Director Jeff Zients, took a strong stand against what it aptly described as “a maneuver designed to tie the CFPB in knots.”
Since it opened its doors in 2011, the Consumer Bureau has been doing the job it was meant to do: making financial markets fairer, safer, and more transparent. Through its enforcement actions, the Bureau has returned more than $11 billion to some 25 million Americans cheated by financial companies. In short, it has been working very well with a single director; and that record of accomplishment is precisely what makes this agency, as presently constituted, so objectionable to so many bankers, lenders, and ideological opponents of the whole idea of regulation.
Industry forces made a big effort to win more Democratic votes. But in the end, they fell short: the Financial Services Committee approved HR 1266, but in a largely partisan vote that dimmed its prospects for becoming law. With their hard push, however, the bill’s backers made it very clear just who is pushing for a commission instead of a single director, and why.