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Ruling Against Wall Street Watchdog Decried as 'Reckless and Partisan'


#1

Ruling Against Wall Street Watchdog Decried as 'Reckless and Partisan'

Deirdre Fulton, staff writer

A federal appeals court's ruling on Tuesday that the structure of the Consumer Financial Protection Bureau (CFPB) is unconstitutional has been decried as a "reckless and partisan" attack on the independent watchdog agency.

The decision (pdf) from a three-judge panel said the CFPB is "unconstitutionally structured," as it is run by a single director who "enjoys more unilateral authority than any other officer in any of the three branches of the U.S. government, other than the president."


#2

The three-judge panel: two appointed by George Bush the junior, one appointed by George Bush the elder.


#3

Corporate Governance run amok.


#4

If the CFPB was set up like the FED and the CFPB is unconstitutional, then shouldn't the FED be unconstitutional as well?
Or did Elizabeth Warren make a big mistake when she set this agency up?
And if she did why?
Any thoughts on this ruling Ms Warren?


#5

At least we're Number One.


#7

I dreamed of a Citizens' Puke-in, where a million people gathered in those corrupt Wall Street establishments and suddenly got so sick of all the corruption that they vomited EVERYWHERE. Every square inch of every bank and brokerage was covered, inches thick. Rivers of vomit ran down the hallways, stairways, streets, and alleys. The stench was overwhelming, almost as bad as the stench of some of these banks' everyday transactions. Now we have courts DEFENDING those multi-millionaire maggots?!? If those crooks weren't so gross with their greed there would have been no citizen outcry for a CFPB in the first place.


#8

I wonder if this is the first far-right judicial salvo on the independence of administrative agencies. The constitutionality of the agencies themselves is based on the constitutional mandate that the executive branch carry out the laws passed by congress. The INDEPENDENCE of the agencies, however, is based on the notion of professional expertise and independence from political pressure. Social Security is run by a single commissioner. Does this decision pave the way for declaring the structure of the social security administration to be unconstitutional. and placing the SSA under the direction of a political overseer?

From the case text, in a footnote:

"Because the Social Security Administration and the Office of Special Counsel do not exercise the core executive power of bringing law enforcement actions and because they have narrow
jurisdiction, a holding invalidating the single -Director structure of the CFPB would not necessarily invalidate the single-Director structure of the Social Security Administration and the Office of
Special Counsel. That said, if those two agencies are unconstitutionally structured, the remedy would presumably be the same remedy as in Free Enterprise Fund : severing the for-cause
provision so that the agencies would continue to fully operate, albeit as traditional executive agencies rather than independent agencies. Cf. infra pp. 65-69. We do not address those questions here."

Yup, the door is open.


#9

I have repeatedly posted that restoring the New Deal financial industry regulations that were ditched during the past three plus decades is the only way to protect consumers from fraud and the economy from crashing again. CFPB was a better than nothing feeble effort to resolve some of the problems deregulation created, certainly better than Dodd-Frank legislation that was written by Wall Street to handicap community banks in order to enable the five too-big-to-fail Wall Street banks to monopolize US banking.

Perhaps Warren didn't consult the constitutional law expert occupying the Oval Office when the CFPB was being structured to shake out any constitutionality questions ?


#10

It might be worth noting that the repeal of Glass-Stegall was under a Clinton presidency.


#11

Sad, this seemed to be one of the few agencies that actually seemed to keep the interests of the American people in mind. All this so a greedy mortgage company engaged in illegal activities would have avoided a massive fine (which doesn't even make sense). The idea that the head of the agency is more powerful than the President is farcical.


#12

Guess the CFPB is just a little too successful to be tolerated. Look forward to hearing from Ms. Warren soon.


#13

I get your gist, but this is actually corporate governance working. It's government of, by, and for the people that's been sidetracked.


#14

Keep in mind that this case will be appealed and - as long as Trump is not elected - will likely be reversed.


#16

Thanks to George Bush who stacked the courts with Repubs before he left, we can't have nice things. If it benefits the people in any way, it's gotta go.


#17

Actually, the whole basis for the ruling is that the CFPB was not set up like the FED, with multiple individuals at the top to countercheck each other. And in reviewing the history of how the CFPB was designed, on p.6 of the ruling summary, it states quite flatly that the single-head structure was Congress's idea, not Warren's or the administration's:

Congress ultimately departed from the Warren and Administration proposals, and from the House bill. Congress established the CFPB as an independent agency headed not by a multi-member commission but rather by a single Director.

I.e., the child was poisoned at birth. Yep, set up for this ruling just before a change of administration. Damn!


#18

Yikes! Especially since this "flaw" in the CFPB was added by Congress.


#19

See p.6 of the (summary) ruling: The flaw was added by Congress, undermining the structure originally proposed by Warren and the Administration.


#20

We must hope. And maybe we need to be ready to back Sens. Warren and Sanders when they introduce legislation to fix the constitutional birth defect inserted by Congress on creation of the CFPB (the single director).


#21

True - that may be passable legislation under a Clinton presidency ... not because she will push for it - but because progressives can align with Clinton hating Republicans who would probably prefer an independent CFPB over a director that answers to the White House.


#22

"The mimic owns both parties of the duopoly lock, stock and barrel."
"there is no ideological separation between Democrats and Republicans"
"CFPB, EPA, FDA, USDA and all the rest.....subject to the political whims."

Yet another stirring example of the reasoning which garners the Green Party an astounding 2% of the vote.

Not everyone is bought and paid for.

"CFPB, EPA, FDA, USDA and all the rest are....shining examples of our best ideas.
Do they need a tune up....sure.

It's called a participatory government for a reason.
Gotta actively steer the Ship of State towards justice.