Federal agencies are like horror-movie villains: no matter how many times you try to kill them, no matter how many people promise to end them once and for all, they always seem to keep popping up and scaring the daylights out of people.
The Consumer Financial Protection Bureau (CFPB) is a perfect example. Conservatives in the House and Senate have played Van Helsing to its Dracula since the agency first bared its fangs in 2011, but they have yet to find a wooden stake to kill it.
That’s why the approach of the last two leaders of the CFPB, both Republican appointees, has been so important. Mick Mulvaney (who served as acting director from 2017-18) and newly-confirmed Director Kathy Kraninger recognized that given the apparent immortality of the CFPB, the best way to control its power is to make sure it operates within the confines of our constitutional framework: its power must be limited, its actions must be transparent, and it must be independent.
But transparency and true independence run counter to the vision that for new House Financial Services Committee Chairwoman Maxine Waters (D-Calif.) and her Democratic colleagues have for CFPB. Those virtues challenge their firm belief in excessive and punitive regulation, as well as the original mission of the bureau as envisioned by Sen. Elizabeth Warren (D-Mass.).
When the CFPB was created nearly a decade ago, Warren and company envisioned an agency that would operate as an anti-business regulation mill to reward left-leaning consumer groups that are key constituencies to the Democratic Party, under the guise of ‘consumer protection’ and ‘independence.’ After all, it is well documented that the bureau’s first director, Richard Corday, used the agency to lay the groundwork for his failed gubernatorial run in Ohio.
Ronald Rubin — a former enforcement attorney at the CFPB — laid out the “rationale” behind Democrats’ claims for CFPB independence perfectly:
In 2010, the Democratic House of Representatives, filibuster-proof Senate, and president did not intend to create a regulatory agency independent from politics, just an agency independent from Republicans.
One-party agencies are unconstitutional, so Democrats could not be so explicit. They knew President Obama would appoint the bureau’s first director and influence the hiring of its senior management team, a task he ultimately delegated to then-presidential assistant Warren. Therefore, Democrats could achieve their goal by structuring the “independent” agency to prevent control from switching parties without the rare political dominance they enjoyed in 2010.
True to form, Chairwoman Waters is trying to wrestle back the keys to the proverbial castle. In a recent media interview, she declared her intention “to try and undo the damage that Mulvaney has done.” She added, “The last two years have been very dangerous. I have been appalled and surprised at how blatant it has been.” She also said in a recent speech that she sent a letter to Mulvaney informing him that “while his time running the Consumer Bureau may be over, the time for accountability for his actions is about to begin.”
Waters’ stance should surprise no one. Last October, she introduced legislation aimed at restoring a pre-Mulvaney organizational structure while capping the number of political appointees at the bureau. Ironically called “the Consumers First Act,” this bill was backed by a host of liberal interest groups, including the Center for Responsible Lending, which was reported to have “cozy ties” to the bureau under Cordray.
For more than five years, congressional Democrats insisted on the CFPB’s “independence.” And they insisted that any attempts by now-retired House Financial Services Committee Chairman Jeb Hensarling (R-Texas) to rein the agency in was a violation of the CFPB’s independence. That was because the agency was already packed with Warren loyalists. For all intents and purposes, the agency was just another arm of the Democratic machine.
When Mulvaney took over as acting director, he did not try to dismantle the agency entirely, which would have been the preferred course, but he did the next best thing: he reined it in, adopting a constitutionalist approach to how the CFPB would operate — making the agency truly independent and non-partisan, with limited powers, and a commitment to transparency.
Now that Chairwoman Waters appears intent on using the gavel to once again try and bring the CFPB under Democratic control, I hope the public sees her charade for what it really is.
Colin Hanna is president of Let Freedom Ring USA Inc., a nonprofit organization committed to promoting constitutional government, free enterprise and traditional values.
The views and opinions expressed in this commentary are those of the author and do not reflect the official position of The Daily Caller.