English vs. Mulvaney: the Battle for the CFPB - by Greer Clem

This weekend, while families across the country indulged in leftovers and football games, the Consumer Financial Protection Bureau was once again thrown into chaos. After Richard Cordray resigned as director on Friday, the Trump administration was quick to announce that Mick Mulvaney would be taking his place, prompting acting director, Leandra English, to file a lawsuit Sunday evening in the hopes of preventing the CFPB from infiltration by the Trump camp. While this story does not have the glitz or juiciness of the ongoing Russia investigation, there are several important things to make note of. The Trump administration is hoping the average American will let this maneuver go unnoticed, but, unfortunately for them, I’m a stickler for information.

First and foremost, what is the Consumer Financial Protection Bureau? The Dodd-Frank Act of 2010 established the CFPB as an agency that would oversee the financial sector in the wake of the 2008 recession. Though it is located within the Federal Reserve, the Bureau itself remains an independent agency so as to impartially fulfill its obligations. The agency was first proposed by Senator Elizabeth Warren who then was considered for the position of director. Ultimately, President Obama nominated Ohio Attorney General Richard Cordray to fill the position as Warren was seen as too far left. Since its inception, the agency has been largely unsupported by members of the GOP who see it as a hindrance to the American financial sector or else redundant.

That brings us to Friday when Cordray announced his resignation. His deputy, Leandra English, then lawfully assumed the position of Acting Director. But that didn’t stop Trump’s pick, Mulvaney, from showing up to the office Monday morning with donuts. Both English and Mulvaney came to work this morning believing themselves to be Directors of the CFPB, which brings us back to the lawsuit.

The suit filed by English last night contests whether it is lawful for Trump to appoint a new Director under provisions of the Dodd-Frank Act. Under Dodd-Frank, if the acting Director steps down, the Deputy Director assumes that role until the President nominates and the Senate confirms a new Director. Trump has tried to skirt that provision by arguing that the the president’s authority under the Federal Vacancies Reform Act allows him to install Mulvaney instead. However, as English pointed out in her suit last night, “the Vacancies Act, by its own terms, does not apply where another statute ‘expressly...designates an officer or employee to perform the functions and duties of a specified office temporarily acting in that capacity,’” which Dodd-Frank does. English also notes that the Dodd-Frank Act in its previous form would have allowed the President to use the Vacancies Act to circumvent this rule, however the Act was revised and language replaced that now specifies he has no such authority.

English also noted that Mulvaney has previously co-sponsored legislation to eliminate the CFPB and has called the agency “a sick joke.” Aside from the fact that Mulvaney has no history in the area of consumer finance, he obviously is a biased pick for the position of director. Trump was hoping to sneak an anti-regulation ally into the agency that is designed to hold our financial systems accountable. It is no secret that Trump is a supporter of deregulation, something that goes hand in hand with Paul Ryan’s tax plan. But the Dodd-Frank Act exists for a very concrete reason, one I would hope legislators would not be quick to forget, as it was less than 10 years ago that our nation’s economy plummeted. This is yet another reminder that neither Trump nor anyone in his administration has the interests of the American people at heart. He has compiled a group made of the 1% with little experience in the public sector and few financial scruples. I don’t say that to sound alarmist; I say it because it’s true. There could be healthy debate about aspects of the Dodd-Frank Act or the CFPB and whether certain measures could be revised - but the GOP isn’t interested in working across the aisle. And, frankly, neither are Democrats at this point. Why play by the rules when the other side burned the rule book? It is for this purpose that the Dodd-Frank Act exists, for in these moments where we cannot work together, we rely on the law to protect us from ourselves.

A federal court in D.C. is expected to hear arguments Monday at 4:30 pm regarding who should be considered Director of the CFPB.

Greer Clem