The Trump administration is like a builder whose only tool is a hammer: regardless of what industry we’re talking about, they stick to the same old bit: deregulate.
Now Wall Street has come seeking favors, and Treasury Secretary Steve Mnuchin, a Goldman Sachs alumnus, is wielding a sledgehammer.
Mnuchin’s Treasury Department has released a report on its recommendations for “regulatory reform” (read: rollbacks). The report starts out with the false premise of an overregulated economy, and then goes on to propose “solutions” that could only lead to a less stable financial system and rampant consumer abuse.
If this all sounds familiar, it’s because the House of Representatives passed a bill last week that would unleash Wall Street banks and predatory lenders on unsuspecting American consumers.
The Treasury report contains lies about supposed “problems” created by the Consumer Financial Protection Bureau, the 7-year-old agency that stands up for ordinary people when they’re ripped off.
Mnuchin would have you believe that the CFPB has “hindered consumer choice… limited innovation, and imposed undue compliance burdens” on financial institutions. He can’t come up with any evidence of course — it’s just a talking point offered up as a pretext for deregulation. And as for “burdens,” he sure doesn’t mention that American banks earned profits of $44 billion in the first quarter of this year alone.
The CFPB has done nothing but good for the ordinary Americans over the past 6 years. Whether it’s common-sense rules on mortgages or prepaid debit cards, the CFPB has done right by people across the nation. It has won relief worth $12 billion for 29 million consumers. The CFPB is only a problem for the Wall Street bankers and predatory lenders it keeps in check.
The Treasury Department’s recommendations include a call to strip the CFPB of its power to supervise and examine banks and other financial services companies. This would be a disaster. Since 2011, the CFPB has been at the forefront of the fight against Wall Street and anyone else who profits from defrauding consumers.
The CFPB recently fined Wells Fargo $100 million for creating fake accounts in the names of millions of customers. The CFPB received a whistleblower tip about this and then, figuratively speaking, marched into the mega-bank to see what was going on. After doing interviews and conducting depositions, the CFPB escalated into enforcement action and brought the hammer down on Wells Fargo — a perfect example of the CFPB fulfilling its mandate of sticking up for ordinary Americans.
The report also goes on to describe the bureau as “unaccountable to the American people”, while mentioning how the director cannot simply be fired by the president, like, oh, the FBI director.
Is it a surprise that the Trump administration wants to be able to fire the CFPB director? It shouldn’t be, not to any of us. What’s more, the Treasury also wants to subject the CFPB’s funding to the annual congressional appropriations process, which would let Wall Street lobbyists pressure lawmakers into cutting its budget. And we all know how that would go.
The last thing Wall Street needs is deregulation. It needs strong rules, and a strong federal agency to enforce those rules.
We can stop the Trump Administration from enacting these recommendations by making our voices heard. Tell Trump: Hands off financial reform.