A House Financial Services Subcommittee yesterday approved three bills that would change the structure of the newly-created Consumer Financial Protection Bureau in such a way that its independence — a key feature — would be undermined. Republicans claim that these bills are necessary to reduce the Bureau’s power, even though the Bureau can already be overruled by a two-thirds vote of the Financial Stability Oversight Council (a panel of regulators charged with policing systemic risk in the financial system).
The three separate measures would, respectively: replace the Bureau’s director with a five-member commission; make it easier for bank regulators to veto the Bureau’s rules; and delay the date on which the Bureau officially stands on its own (currently July 21). The second, sponsored by Rep. Sean Duffy (R-WI) and co-sponsored by House Financial Services Chairman Spencer Bachus (R-AL) and Rep. Shelley Moore Capito (R-WV), would lower the threshold for the FSOC to veto a Bureau rule from a two-thirds vote to a simple majority vote, and remove the CPFB director from his/her seat on the FSOC.
This is a move backed by, among others, the American Bankers Association, which donated $10,000 to all three of the GOP sponsors during the 2010 election campaign. In fact, all three of the Republican sponsors of this bill received significant amounts of money from the financial services industry during the 2010 election cycle*:
REP. SPENCER BACHUS (R-AL): Bachus received nearly $400,000 from the finance industry (including commercial banks, securities firms, and investment banks), including $10,400 from Goldman Sachs, and $10,000 each from the American Bankers Association, Bank of America, Wells Fargo, and Morgan Stanley.
REP. SHELLEY MOORE CAPITO (R-WV): Capito received nearly $118,000 from the finance industry, including $10,250 from JP Morgan Chase, $10,000 each from the American Bankers Association and Goldman Sachs, and $5,000 each from Bank of America and Citigroup.
REP. SEAN DUFFY (R-WI): Duffy received nearly $110,000 from the finance industry, including $10,000 from the American Bankers Association, $5,250 from JP Morgan Chase, and $3,000 from the Financial Services Roundtable.
All told, Republican members of just the subcommittee that advanced these bills yesterday received $1.6 million from the finance industry during the 2010 election cycle.
Bachus said back in December that Congress’ role is to “serve the banks.” His committee has certainly taken that to heart with its action today to kneecap the one agency within the financial regulatory system explicitly tasked with protecting consumers from the financial industry’s excess.
*Totals compiled by ThinkProgress from data from the Center for Responsive Politics.