"Senate Showdown: Consumers v. Banks"
Will Republicans Side with the 1 Percent Again?
Last week, there was a real moment of clarity when Republicans voted to side with just 345,000 millionaires instead of 160 MILLION working Americans. This week, we’ll get another such moment when the Senate tries take up the nomination of Richard Cordray, who President Obama has nominated to head the new Consumer Financial Protection Bureau. Republicans will have to choose whether to side with consumers or to side with Wall Street and predatory financial institutions like payday lenders.
Here’s the rundown.
WHO: Richard Cordray, the former attorney general of Ohio, who the president nominated in July to head up the Consumer Financial Protection Bureau. Cordray has an excellent record when it comes to consumer issues and he helped Elizabeth Warren get the new agency up and running.
WHAT: The Consumer Financial Protection Bureau, a new agency created by the Dodd-Frank Wall Street reform bill. The agency is the only financial regulator to have protecting consumers at the heart of its mandate and has extensive oversight, regulatory, and enforcement authority over banks and other financial institutions like payday lenders.
The U.S. Chamber of Commerce and the banks made killing the agency a top priority during last year’s Wall Street reform fight. After it became clear that they couldn’t kill it outright, Wall Street and its Republican allies instead tried to weaken the CFPB by replacing the director position with an unwieldy, less effective five-member governing board. All of these attempts failed and the final Dodd-Frank bill included the strong CFPB that reformers had called for.
The opponents of a strong consumer advocate didn’t stop there though. In addition to calling for outright repeal of the entire Wall Street reform law, the Republican-controlled House of Representatives has busied itself with various bills to weaken the Bureau — essentially trying to re-litigate the fights they lost last year.
SHOW ME THE MONEY: Unsurprisingly, opponents of the Bureau have accepted millions of dollars from Wall Street. Just three GOP co-sponsors of anti-CFPB bills in the House racked up an impressive $1.4 MILLION in Wall Street cash during the 2010 election cycle. Those in the House who voted to cripple the agency earlier this year have taken 83 percent more money from Wall Street than those who didn’t. And the 10 Republican senators who voted against Cordray’s nomination in Senate Banking Committee have taken an astonishing $31 MILLION from the financial industry.
ENDLESS OBSTRUCTION: Forty-four Republican Senators signed a letter saying they’d vote against any nominee to head the CFPB unless and until they get their way and the agency is severely weakened.
So far, only one Republican, Sen. Scott Brown (R-MA), has said he’ll support Cordray’s nomination. Brown is of course currently locked in a tight Senate race against Elizabeth Warren — the very person who thought up the agency, fought for it, and set it up.
While Republicans in Ohio, including his successor as Ohio attorney general, and business groups like the Ohio Chamber of Commerce even support Cordray, the Buckeye State’s junior senator, Rob Portman (R), has refused to say which way he’ll vote.
WHY IT MATTERS: The need for a strong Consumer Financial Protection Bureau to look out for consumers is obvious, but the way the CFPB is structured makes confirming a director all the more important. In addition to providing the necessary leadership at the top, some of the CFPB’s powers — including its ability to write new regulations — don’t go into effect unless it has a director. Republicans obstructing the confirmation of a director is just one more way to keep the banks and others from being held accountable.
IN ONE SENTENCE: If Republicans filibuster the nominee to head the new Consumer Financial Protection Bureau, it’ll be clearer still that they’ll do nearly anything to protect Wall Street and the wealthiest 1 Percent.
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