COLUMN: Sen. Kyrsten Sinema: End the CFPB’s political football by creating a bipartisan commission
Most of us remember the financial crisis of 2008, when millions of Americans lost their jobs and homes. In response, Congress passed a massive reform law called the Dodd-Frank Act. That law was designed to protect American financial institutions and consumers from facing another such crisis in the future. I came to the House in the years following passage of Dodd-Frank, not long after the Consumer Financial Protection Bureau was created as part of Dodd-Frank.
The CFPB was a fine idea in theory, an independent agency that would stick up for and protect consumers from shady, illegal practices. The agency had potential to help consumers recover from scams, to have somewhere for them to go when wronged, a place to learn financial literacy to make sound decisions. It was a new agency when I got to Congress, and yet I saw that the two parties were already fighting over the agency and its leadership.
Back then, I believed that the CFPB would be best served by a multi-person bipartisan commission, with staggered terms to ensure that no one party or opinion could sway the fundamentally non-partisan work of protecting consumers. I spent years working on a bill that would change CFPB leadership from one appointed person to a bipartisan commission that would outlast any one administration — ensuring continuity and bipartisanship regardless of short-term political winds.
That bill never made it to a President’s desk; the party in charge was never interested in making the change. And now, here we are more than a decade and a half into the CFPB’s existence, and the CFPB is one of the most political and contentious agencies in Washington.
In the last administration, the CFPB’s Director spent an awful lot of time pursuing an agenda that was beyond the agency’s scope. As administrations change, the pendulum swings the other direction, with cuts to funding and staffing that may hinder the agency’s ability to help consumers in a fast-changing financial marketplace.
Policy volatility has become the coin of the realm in Washington over the last two decades, but the fallout is uncertainty for businesses and confusion for consumers. The United States’ financial marketplace is rapidly changing, with new entrants to the market, technological innovations and disruptions, and more. These changes mean more choices facing American consumers, but without clear rules of the road and fair practices for all, consumers risk getting fleeced by bad actors.
Having a capable and credible consumer watchdog agency is more important now than ever. Congress can end the CFPB’s political football and establish a bipartisan commission with strong congressional review to ensure that the agency has a clear mandate, transparency in its operations, limits on its power, and accountability to the US government and the consumers it serves.
Sen. Kyrsten Sinema represented Arizona in the House and Senate
