Agency Too Powerful

PUBLISHED: 6:30 PM 3 Apr 2018

Head Of Consumer Protection Bureau Exposes Agency As “Far Too Powerful”

The problem appears to be the result of Obama-era government overreach.

“The structure and powers of this agency are not something the Founders and Framers would recognize.”

Senator Elizabeth Warren (D-Mass.) is on the warpath. Since President Trump handed control of the Obama-era U.S. Consumer Financial Protection Bureau (CFPB) to Mick Mulvaney, he turned it into a “politicized rogue agency,” she complains. What really has the senator’s blood boiling is that Mulvaney agrees with her completely.

He knows that the agency has entirely too much power and too little oversight. In the semi-annual report he turned in Monday, he even quotes James Madison. His agency’s concentration of “legislative, executive, and judiciary power,” he writes, “may justly be pronounced the very definition of tyranny.”

“The structure and powers of this agency are not something the Founders and Framers would recognize,” Mulvaney adds.

Mr. Mulvaney isn’t bothered at all by Senator Warren’s criticism. He points out that the CFPB is her brainchild, created intentionally to be tyrannical. It shouldn’t be a big surprise to her that he can thumb his nose at Congress and get away with it.

“I am the judge, I am the jury, and I am the executioner in some of these investigations, and that is completely wrong, Mulvaney has said previously. “If you don’t like it,” he says, “talk to the person who wrote the statute.”

The way the law is written, the CFPB Director has three different and powerful jobs at the same time. The director is a “one-man legislature” allowed to “write rules to bind parties in new ways.”

As the top administrator, the director’s power is only slightly limited by the president. Any time there is a dispute, the director has final say over “in-house court-like adjudications.”

He’s practically begging Congress to change that. Meanwhile, he promises to do as little as possible. He knows that throwing his weight around can do more harm than good.

“The best that any Bureau Director can do on his own is to fulfill his responsibilities with humility and prudence, and to temper his decisions with the knowledge that the power he wields could all too easily be used to harm consumers, destroy businesses, or arbitrarily remake American financial markets.”

The lack of accountability should be a neon warning sign “that a lapse in democratic structure and republican principles has occurred,” Mulvaney warns. “This cycle will repeat ad infinitum unless Congress acts to make it accountable to the American people.”

It is a very rare thing for a government bureaucrat to voluntarily give up power. Mr. Mulvaney made four distinct recommendations specifically to remove some of his agency’s overly broad discretion.

Instead of simply taking their cut by holding onto the fines they collect for the feds, the budget money should come from Congressional appropriations. That way Congress can control the purse strings. Currently, they get their money directly from the Federal Reserve.

As it stands now, the bureau makes its own rules. Mulvaney insists that Congress should at least have the power to “veto” their rules and regulations.

He also says the agency should have more oversight from the president and the administrative branch when applying “executive authority.”

Finally, he recommends an Inspector General be appointed to watch over their activities. Every other branch of the government has an internal watchdog OIG.

The CFPB was created in 2010. The official job of the independent agency is “to protect consumers from predatory lending and financial abuse.”

When Mulvaney took over, he found out that its real function is to act as a slush fund. Particularly as a democrat slush fund.

Ever since the CFPB was formed, conservatives have called it unconstitutional. The only official that is appointed politically is the director. A president can’t fire that director without “significant” cause.

The way the law that created the CFPB was written, an outgoing director could choose their replacement, and hand the reigns to another democrat.

What Senator Warren and her cohorts weren’t counting on when they crafted the Dodd-Frank legislation was a republican president throwing a monkey wrench into things, by allowing a republican to be appointed acting director.

Obama minion Richard Cordray held the post until last November. When he stepped down, he handed the keys to his trusted lieutenant, Leandra English. President Trump had other ideas.

It took a ruling from a U.S. District Court judge to pry Ms. English out of the chair so that President Trump’s pick, Mick Mulvaney, could officially take charge. She is still fighting the decision in court.

As soon as Mulvaney settled in, he started looking over the files. That is when he found out about all the cash doled out to democratic cronies.

The CFPB collected arbitrary “fines” from banks and other financial institutions, meant to be passed along to poor “victims.”

The victims got pennies while millions of dollars “set aside for the education funding” to “educate the public on its mission,” were spent hiring democrat businesses.

For instance, $14 million went to the “powerful media consulting shop that has produced political ads for Obama and 2016 runner-up Hillary Rodham Clinton.”

The Competitive Enterprise Institute called CFPB “a Democratic Party donor bank, with its bureaucrats writing checks to liberals at a rate of 593 to one Republican, including $46,611 to Clinton, $13,190 to Warren, and $19,988 to Obama.”

So much money built up in the slush fund that Acting Director Mulvaney didn’t need funding for his second-quarter budget. This January, he totaled up his department’s needs at $145 million for the term. There was already $177 million laying around the office in the “reserve fund.”

Mr. Mulvaney wrote to outgoing Federal Reserve Chair Janet Yellen that the CFPB didn’t need a dime for its second quarter. He suggested she use it to make an extra payment on the national credit card.

“While this approximately $145 million may not make much of a dent in the deficit, the men and women at the Bureau are proud to do their part to be responsible stewards of taxpayer dollars,” he wrote.