The Consumer Financial Protection Bureau has an avowed socialist on one of its advisory boards — a revelation that has some conservatives fuming, saying it’s another reason why Congress must impose more transparency on the powerful bureau.
After a congressional Republican was denied entry into an advisory committee’s meetings in February, he filed legislation demanding that the bureau abide by all open-government rules that apply to other commissions.
On Tuesday, House Budget Committee Chairman Paul Ryan, Wisconsin Republican, proposed stripping the bureau of its independent funding and bringing it under strict congressional oversight.
The moves underscore how the relatively new bureau has become a flashpoint in the battle over the size and scope of the federal government and its web of regulations.
Mark Calabria, director of Financial Regulation Studies at the libertarian-leaning Cato Institute, said the appointment of Ron Ehrenreich to a position on the bureau’s Credit Union Advisory Council raises red flags. Mr. Ehrenreich is CEO and co-founder of the Syracuse Cooperative Federal Credit Union and 1988 vice presidential candidate for the Socialist Party USA.
Mr. Calabria said there should not be a political litmus test for advisory board members but that Mr. Ehrenreich’s involvement on a board is symbolic of a larger concern that the “CFPB has gone out of its way to invite and have people on its advisory boards that echo its own viewpoints.”
“It would be great to have a broader range of people actually represented,” Mr. Calabria said. “So, to me, I think it really speaks to very deep-seated groupthink over there that consumers are being exploited and markets are bad, and if you don’t have lots of government regulations and lawyers then people are going to be taken advantage of.”
The Consumer Financial Protection Bureau was created in 2010 as part of the Dodd-Frank legislation that rewrote financial oversight laws in the wake of the 2008 Wall Street collapse. Democrats wanted the bureau to be an independent auditor that could protect individuals from predatory financial firms.
The bureau has adopted rules governing mortgage lenders and has gone after credit card companies for misleading business practices. It is in the process of formulating rules aimed at reining in the payday lending industry and could tackle issues involving student loan providers.
“As far as I know, I am the only socialist on any of the advisory committees,” he said, adding that members represent an array of opinions and come from credit unions of different sizes. “I would not consider the participants in the CUAC to be left-leaning. There is quite a variety of opinions expressed. Some I find quite dismaying.”
Consumer Financial Protection Bureau spokesman Samuel Gilford said the agency does not screen its board and advisory council members’ political views.
“Doing so would be highly inappropriate,” he said. “Members of the Credit Union Advisory Council were selected based on their expertise and experience.”
Mr. Ehrenreich said he has been working in the credit industry for over 30 years and has tried to speak up for the people he serves: the poor, immigrants and refugees who are struggling to make ends meet.
“I try to bring the voice of the voiceless to the credit union advisory committee,” he said.