Mulvaney requests no funding for Consumer Financial Protection Bureau

Every quarter, the Consumer Financial Protection Bureau formally requests its operating funds from the Federal Reserve. Last quarter, former director Richard Cordray asked for $217.1 million. Cordray, an appointee of President Barack Obama, needed just $86.6 million the quarter before that. And yesterday, President Donald Trump’s acting CFPB director, Mick Mulvaney, sent his first request to the Fed.

He requested zero.

In a letter to Fed chair Janet Yellen obtained by POLITICO, Mulvaney wrote that the bureau already has $177 million in the bank, enough to cover the $145 million the bureau has budgeted for its second quarter. Cordray had maintained a “reserve fund” in case of overruns or emergencies, but Mulvaney said he didn’t see any reason for it, since the Fed has always given the bureau the money it needs. Mulvaney, who is also Trump’s budget director, noted that instead of advancing the funds to the bureau, the Fed could return them to the Treasury and reduce the deficit.

“While this approximately $145 million may not make much of a dent in the deficit, the men and women at the Bureau are proud to do their part to be responsible stewards of taxpayer dollars,” Mulvaney wrote.

The Trump administration has not shown much interest lately in deficit reduction, but it has shown avid interest in reining in the independent CFPB. As a member of Congress, Mulvaney (R-S.C.) routinely denounced it as an overzealous regulator, and on his first day at the bureau after replacing Cordray in November, he trashed his new workplace as “an awful example of a bureaucracy gone wrong.” And even as Cordray’s former deputy, Leandra English, has fought Mulvaney’s appointment in court, he has moved swiftly to shake up its culture.

Earlier this week, he announced the bureau would reconsider its new rules designed to protect consumers from payday lending debt traps, and yesterday, he launched a formal review of how the bureau demands information from firms it investigates. He has even revamped the agency’s mission statement; the new wording suggests that its first priority should be “identifying and addressing outdated, unnecessary, or unduly burdensome regulations.”

The bureau was created in response to the financial crisis of 2008, and under Cordray, it returned nearly $12 billion to nearly 30 million ripped-off consumers, cracking down on predatory lenders, bullying debt collectors, and a range of Wall Street scoundrels. But the financial industry and many Republicans have portrayed it as an out-of-control liberal bureaucracy, a hotbed of the anti-Trump resistance nestled inside the Washington bureaucracy, with a budget untouchable by Congress and a director with unusually broad powers. And several federal judges have rebuked the agency for overstepping its authority in pursuit of scammers.

Mulvaney has not yet laid out his plans for the bureau, but it’s clear that in general he wants it to do less, so it’s not surprising that he wants it to make do with with less money. In his letter to the Fed, he said he had been assured that the cash the bureau already has on hand is “sufficient to carry out its statutory mandates for the next fiscal quarter while striving to be efficient, effective, and accountable.”

It’s just the latest sign that change is coming to the CFPB. As Mulvaney said after his first day as acting director: “Elections have consequences at every agency.”

[Politico]

Trump changes Consumer Protection Bureau to Deregulation Bureau

Trump budget director Mick Mulvaney, a month into his job moonlighting as head the CFPB, has rewritten the consumer watchdog’s mission statement. In a nutshell, the regulatory agency is now a deregulatory agency. Here’s the before and after:

Then: “The CFPB is a 21st century agency that helps consumer finance markets work by making rules more effective, by consistently and fairly enforcing those rules, and by empowering consumers to take more control over their economic lives.”

Now: “The Consumer Financial Protection Bureau is a 21st century agency that helps consumer finance markets work by regularly identifying and addressing outdated, unnecessary, or unduly burdensome regulations, by making rules more effective, by consistently enforcing federal consumer financial law, and by empowering consumers to take more control over their economic lives.”

[Politico]

Trump moves to weaken black lung protections

President Donald Trump is considering weakening a regulation intended to protect the health of one of the demographics he has often claimed to care most about — America’s coal miners.

A notice labeled “Regulatory Reform of Existing Standards and Regulations; Retrospective Study of Respirable Coal Mine Dust Rule” was published on Thursday by the White House for the Labor Department’s Mine Safety and Health Administration, according to the Charleston Gazette-Mail. The stated purpose of the reevaluation would be to determine how a 2014 rule passed under President Barack Obama regulating coal miners’ exposure to coal dust “could be improved or made more effective or less burdensome.”

When the rule was first implemented, it utilized new technologies and increased sampling in mines so that workers would have real-time information about dust levels. This would in turn allow both the miners and operators to minimize the chances that workers would be overexposed to coal dust, which has caused an epidemic of black lung disease among coal miners.

In spite of a 1969 law that increased coal mine safety requirements, more than 76,000 coal miners throughout America died of black lung disease between 1968 and 2014. Many of those deaths occurred among coal miners whose entire mining careers took place after the 1969 law had taken effect.

In response to the announcement that the coal dust rule would be reevaluated, the National Mining Association released a statement saying, “While we’ve not had any discussions with the agency regarding the retrospective study, we think it might shed valuable information on operation of the rule since its promulgation and ways it might be improved to provide further protection for miners while eliminating unnecessary implementation requirements for operators.”

Meanwhile a spokesman for mining company Murray Energy — whose owner, Bob Murray, was a major Trump backer in the 2016 election — released a statement saying that it is “pleased that the Federal Mine Safety and Health Administration is reexamining the Obama administration’s Respirable Dust Rule, which fails to protect coal miners in any way.”

Although coal mining has been on the decline in Appalachia over the past few years, that isn’t as a result of Trump’s policies. Part of that is something Trump can’t control. And part of it is something Trump doesn’t want to control. The chief struggle facing coal miners is that natural gas, solar and wind power can outcompete coal due to their low cost and abundance. Making matters worse for coal miners themselves, the coal mining jobs are often the best-paying ones in their area, and job retraining programs have a spotty track record of actually helping individuals who use them.

This latest policy undermines Trump’s longstanding claim to be an ally of coal miners, which he bragged about when he pulled out of the Paris climate accord. “I happen to love the coal miners,” Trump proclaimed at the time.

Trump may have let his true feelings about coal miners be known during a Playboy interview in 1990, however.

“The coal miner gets black-lung disease, his son gets it, then his son,” Trump told Playboy. “If I had been the son of a coal miner, I would have left the damn mines. But most people don’t have the imagination — or whatever — to leave their mine. They don’t have ‘it.'”

[Salon]

Trump picks fight with CFPB, calls agency a ‘total disaster’

President Trump is picking another fight with the Washington swamp by naming his own man as temporary boss of a federal agency conservatives hate.

“The Consumer Financial Protection Bureau, or CFPB, has been a total disaster as run by the previous Administrations pick,” he tweeted Saturday.

“Financial Institutions have been devastated and unable to properly serve the public. We will bring it back to life!” the tweet said.

Leadership of the bureau — the brainchild of liberal Massachusetts Sen. Elizabeth Warren — was put in play Friday by the resignation of director Richard Cordray.

Before he left, Cordray named his chief of staff as his interim replacement. Cordray’s permanent replacement will be decided by Trump and the Senate.

Trump wants Office of Management and Budget director Mick Muvaney to be the agent’s interim boss. Mulvaney has called the agency “a sad, sick joke.”

Senior administration officials said Saturday that a 1998 law trumps the agency’s internal rules — and they won’t shy from a court fight over the dueling interim directors.

“We have gone out of our way to avoid an unnecessary legal battle with Director Cordray,” one official said. “But his actions indicate that he wants to provoke one.”

[New York Post]

Reality

A “disaster”? Maybe fore Trump’s Wall Street friends. Below are several key accomplishments that have benefited consumers since the Dodd–Frank Wall Street Reform and Consumer Protection Act was enacted:

Securing Almost $12 Billion in Consumer Relief

  • The CFPB helped over 29 million individual consumers receive $11.8 billion dollars in due relief, while responding to over 1 million consumer complaints since openings its doors.[2]
  • Through enforcement action alone, the CFPB reduced $7.7 billion in consumer debts while winning $3.7 billion in compensation for consumers.[3]
  • Nearly 50 million households have benefited from new CFPB mortgage servicing protections that protect consumers from surprise costs and terms when repaying their mortgage, and offer additional protection if a borrower falls behind on their mortgage payment.[4]
  • More recently, the CFPB, partnering with the Los Angeles City Attorney’s Office and the Office of the Comptroller of the Currency, uncovered deceptive banking practices at Wells Fargo Bank defrauding millions of customers.[5]  Enforcement action by the CFPB forced Wells Fargo to pay full refunds to consumers harmed by illegal practices and to pay a $100 million penalty for their wanton behavior.

Protecting Service Members from Predatory Practices

  • The CFPB’s enforcement actions provided $130 million in due compensation to service members, veterans, and their families that were harmed by illegal private sector predatory practices.[6]
  • In collaboration with the Department of Defense (DOD), the Office of Servicemember Affairs at the CFPB visited more than 145 military installations, handling over 71,000 consumer complaints from service members and their families,[7] and advised DOD on better rules to protect service members from financial exploitation.[8]

Saving Consumers $16 Billion in Undisclosed Credit Card Fees

  • The Credit Card Accountability, Responsibility and Disclosure (CARD) Act, now under CFPB jurisdiction, reined in the usurious late fees charged on credit cards, limited predatory practices targeting young consumers on college campuses, curtailed sharp interest rate hikes, increased access to consumer credit, and made credit card costs more transparent, saving consumers more than $16 billion in undisclosed fees.[9]
  • The number of new consumer credit cards increased steadily since implementation and enforcement of the CARD Act to 6.5 million new credit cards and $37.5 billion in available credit in July of 2016.[10]
  • In collaboration with private industry, the CFPB made it easier for stay-at-home spouses to gain access to credit cards by allowing them to use total household income in their applications for new accounts or higher credit limits.  This has helped more than 16 million married individuals who do not work outside the home access necessary credit.

Trump repeals consumer arbitration rule, wins banker praise

President Trump on Wednesday signed a repeal of the Consumer Financial Protection Bureau’s rule on forced arbitration, winning praise from banking and business groups.

Trump approved the resolution to repeal the CFPB rule, meant to prevent banks and credit card companies from blocking customers from joining class-action lawsuits against them, in a private Oval Office signing.

The House passed a resolution to repeal the rule in July, which passed the Senate two weeks ago.

Trump was joined by the heads of several banking lobbying groups that opposed the CFPB rule, contending it would kill cheaper options for consumers while enriching trial lawyers.

The chiefs of the Consumer Bankers Association, Independent Community Bankers of America, National Association of Federally-Insured Credit Unions and several other groups attended the signing.

The arbitration rule repeal is a major victory for finance and business groups, which promised to fight the measure soon after it was released in July. Critics say the rule went too far in restricting arbitration based on a CFPB study they consider flawed and misleading.

“Arbitration is a well-established and tested process that offers better results for consumers and helps avoid frivolous class-action suits,” said Independent Community Bankers of America President Camden Fine.

“[Independent Community Bankers of America] thanks the president for swiftly signing this measure into law because it preserves community banks’ contractual right to pursue fair and timely resolution through arbitration and avoid prohibitively expensive and protracted litigation.”

Richard Hunt, Consumer Bankers Association president and CEO, said the arbitration rule “was about protecting trial lawyers and their wallets,” praising Trump and Congress for ensuring “consumers have the necessary tools to receive relief without going through drawn-out class action proceedings.”

Dan Berger, National Association of Federally-Insured Credit Unions president and CEO, said the group “was honored to have been invited to the White House to watch the undoing of a rule that likely would have had negative effects on the credit union industry.”

Democrats and the CFPB criticized Trump, claiming he sides with banks over consumers. They’ve long called for action on forced arbitration, which they say denies fraud victims basic legal rights, and the CFPB rule was the most ambitious effort to regulate the practice.

CFPB Director Richard Cordray said “in signing this resolution, the president signed away consumers’ right to their day in court.”

“This action tips the scales of justice in favor of Wall Street banks less than 10 years after they caused the financial crisis,” said Cordray, who asked Trump on Monday to spare the rule. “By blocking our arbitration rule, this action makes it nearly impossible for ordinary people to stand up for themselves against corporate giants like Wells Fargo and Equifax.

“Now more than ever, it is critical that the Consumer Bureau remain a strong check on financial companies,” he said.

Better Markets, a nonprofit aligned with the CFPB, said, “Today, the Trump administration and Republicans in Congress have made it clear, they are on the side of Wall Street banks not Main Street consumers.”

Rep. Tim Ryan (D-Ohio) called Trump’s repeal “a disgrace,” tweeting that “If [Trump] cared about working people he’d veto this swampy legislation.”

[The Hill]

Pence casts tie-breaking vote to make it more difficult for consumers to sue banks and credit card companies

The Senate has voted to nullify a consumer-oriented rule that would let millions of Americans band together to sue their banks or credit card companies.

Vice President Mike Pence cast the tie-breaking vote Tuesday night to stop the rule from going into effect – the fifth instance he has broken a 50-50 tie since taking office.

Many consumers must go through an arbitrator to resolve financial disputes, but the Consumer Financial Protection Bureau finalized a rule that bans most types of mandatory arbitration clauses.

The rule exposed banks to large class-action lawsuits. Supporters say that possibility would help ensure banks, credit card companies and other lenders treat consumers appropriately.

The vote comes months after House action and reflects the effort of the Trump administration and congressional Republicans to undo regulations that the GOP argues harm the free market.

Democrats said before the vote that nullifying the rule would be a victory for Wall Street.

The resolution will now go to President Donald Trump, who is expected to sign it into law.

[Business Insider]

 

Trump offered a grieving military father $25,000 in a call, but didn’t follow through

President Trump, in a personal phone call to a grieving military father, offered him $25,000 and said he would direct his staff to establish an online fundraiser for the family, but neither happened, the father said.

Chris Baldridge, the father of Army Cpl. Dillon Baldridge, told The Washington Post that Trump called him at his home in Zebulon, N.C., a few weeks after his 22-year-old son and two fellow soldiers were gunned down by an Afghan police officer in a suspected insider attack June 10. Their phone conversation lasted about 15 minutes, Baldridge said, and centered for a time on the father’s struggle with the manner in which his son was killed.

“I said, ‘Me and my wife would rather our son died in trench warfare,’ ” Baldridge said. “I feel like he got murdered over there.”

Trump’s offer of $25,000 adds another dimension to the president’s relations with Gold Star families, an honorific given to those whose loved ones die while serving in support of the nation’s wars. The disclosure follows questions about how often the president has called or written to grieving military families.

The Washington Post contacted the White House about Baldridge’s account on Wednesday morning. Officials declined to discuss the events in detail.

But in a statement Wednesday afternoon, White House spokeswoman Lindsay Walters said: “The check has been sent. It’s disgusting that the media is taking something that should be recognized as a generous and sincere gesture, made privately by the President, and using it to advance the media’s biased agenda.”

Trump said this week that he has “called every family of somebody that’s died, and it’s the hardest call to make.” At least 20 Americans have been killed in action since he became commander in chief in January. The Washington Post interviewed the families of 13 and found that his interactions with them vary. About half had received phone calls, they said. The others said they had not heard from the president.

In his call with Trump, Baldridge, a construction worker, expressed frustration with the military’s survivor benefits program. Because his ex-wife was listed as their son’s beneficiary, she was expected to receive the Pentagon’s $100,000 death gratuity — even though “I can barely rub two nickels together,” he told Trump.

The president’s response shocked him.

“He said, ‘I’m going to write you a check out of my personal account for $25,000,’ and I was just floored,” Baldridge said. “I could not believe he was saying that, and I wish I had it recorded because the man did say this. He said, ‘No other president has ever done something like this,’ but he said, ‘I’m going to do it.’ ”

The president has faced worsening backlash since details emerged of his phone call Tuesday with the widow of Sgt. La David T. Johnson, who was killed Oct. 4 alongside three other U.S. soldiers in Niger. After not addressing the incident for 12 days, Trump on Monday falsely claimed that previous presidents never or rarely called the families of fallen service members. In fact, they did so regularly.

[Washington Post]

Trump: I want to focus on North Korea not ‘fixing somebody’s back’

President Trump praised health care block grants on Saturday, saying they allow the states to focus on health care, but said he would rather focus his energy on tensions with North Korea than “fixing somebody’s back or their knee.”

“You know in theory, I want to focus on North Korea, I want to focus on Iran, I want to focus on other things. I don’t want to focus on fixing somebody’s back or their knee or something. Let the states do that,” the president told Mike Huckabee on the Trinity Broadcasting Network’s “Huckabee.”

“The block grant concept is a very good concept, and if you have good management, good governors, good politicians in the state, it’ll be phenomenal,” he continued.
“I could almost say we are just about there in terms of the vote, so I expect to be getting health care approved,” he said.

Trump’s comments come after Senate Republicans failed twice this year to fulfill a seven-year campaign promise of repealing and replacing ObamaCare.

The latest repeal and replace failure was the Graham-Cassidy bill, which included block grants to states.

However, the legislation failed after Sens. John McCain (Ariz.), Rand Paul (Ky.) and Susan Collins (Maine) announced their opposition to the bill last month, effectively killing it.

Trump has expressed frustration in his Republican colleagues in the Senate for their health care failure, so much so that he called Senate Minority Leader Charles Schumer (D-N.Y.) on Friday to discuss the issue.

The move is likely to unsettle Republicans on Capitol Hill who have been working with Trump on tax reform in recent weeks.

[The Hill]

Trump to cut pay raises for government workers

President Trump sent a letter to Speaker Paul Ryan (R-Wis.) on Thursday announcing his intention to cut pay raises for civilian government workers.

In the letter, Trump cited his authority in times of “national emergency or serious economic conditions affecting the general welfare” to make adjustments to the 2018 pay schedule for federal employees.

Under the previous plan, workers were scheduled for a 1.9 percent bump. Trump will use his authority to lower that to 1.4 percent.

“We must maintain efforts to put our Nation on a sustainable fiscal course,” Trump wrote.

“A pay increase of this magnitude is not warranted, and Federal agency budgets could not accommodate such an increase while still maintaining support for key Federal priorities such as those that advance the safety and security of the American people.”

Pay raises for government workers outside of Washington, D.C., will average only 0.5 percent and will be specified in a coming executive order, Trump said.

The White House did not respond to a question about how much the government would save from the action or whether it had discussed the matter with offices on Capitol Hill.

Trump will maintain the 2.1 percent pay increase for members of the military.

“I strongly support our men and women in uniform, who are the greatest fighting force in the world and the guardians of American freedom,” Trump wrote. “As our country continues to recover from serious economic conditions affecting the general welfare, we must work to rebuild our military’s readiness and capabilities.”

[The Hill]

Trump Picks Lobbyist Linked to Forced-Abortion Sweatshop Scandal as Overseer of Worker Protections in U.S.

President Donald Trump’s pick to be deputy secretary for the Department of Labor is a former lobbyist who worked to allow companies to run sweatshops in the Northern Mariana Islands, a territory of the United States.

Mother Jones reported on Tuesday that Trump nominee Patrick Pizzella was linked to a scandal involving disgraced former Republican lobbyist Jack Abramoff.

Pizzella reportedly helped defeat a bipartisan effort to clean up sweatshops on the islands in the 1990s after horrific details of worker conditions and forced abortions came to light.

According to Mother Jones, Pizzella and his colleagues arranged trips to the Northern Mariana Islands for more than 100 members of Congress in order to defeat the measure.

Read the entire report here.

[Raw Story]

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