House Republicans have long railed against the agency
, saying it is unaccountable to Congress because it gets its funding from the Federal Reserve. The bill, which passed largely along party lines, would subject the CFPB to the appropriations process.
“This is a package … of common-sense reforms designed to make the CFPB more accountable and more transparent to the American people,” said Rep. Jeb Hensarling (R-Texas), chairman of the House Financial Services Committee. “The bill replaces the Bureau’s single, unaccountable director with a bipartisan board. It puts the Bureau’s employees, whose compensation and benefits average $178,521- it puts them on the civil service pay scale.”
“The Consumer Financial Protection Bureau is not responsive to Congress because it doesn’t get its funding from Congress,” said Rep. Sean Duffy (R-Wis.), the bill’s sponsor. “We think it is appropriate when you have an agency that is so powerful and so unaccountable that we give the elected members of the American people the power to say how much money they should have.”
House Democrats, however, say the CFPB needs a director – and its current funding setup – to remain politically independent, Reuters reported.
“Today's vote is just the latest chapter in a relentless Republican attack on consumer protection,” said Rep. Maxine Waters (D-Calif.).
But Republicans, who spent two years blocking CFPB Director Richard Cordray’s confirmation, say the CFPB’s lack of accountability makes it too powerful.
“The CFPB is perhaps the single most powerful and least accountable Federal agency in all of Washington,” Hensarling said. “First, let’s speak of its power. … When it comes our credit cards, our auto loans, our mortgages, the CFPB has unbridled discretionary power not only to make them less available and more expensive, but to absolutely take them away.”
But in the end the bill may be more a symbolic gesture than anything else. It has little chance of passing in the Democrat-controlled Senate, and the White House has said President Obama’s advisers would recommend that he veto the bill if it did pass, saying it would ”undermine critical Wall Street reforms and weaken important consumer protections,” Reuters reported.
The House of Representatives passed a bill Thursday that would eliminate the director of the Consumer Financial Protection Bureau in favor of a commission.