- The Washington Times - Tuesday, April 1, 2014

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.

Mr. Ehrenreich told The Washington Times that the National Federation of Community Development Credit Unions recommended him to the Consumer Financial Protection Bureau.

“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.

He called capitalism the “most productive system that has ever been on the face of the earth” and joked, “You are hearing that from a socialist.

“But, at the same time that it has the chance to generate great wealth it generates more poverty,” he said. “It generates unemployment. It generates poverty. It creates wealth, but the wealth is not distributed.

“I think that the business of socialism is really business,” he said. “It is to make business work for the vast majority of people and not just the few.”

Republicans have tried repeatedly to block the Consumer Financial Protection Bureau from becoming operational, arguing it was too powerful and acted outside of congressional oversight.

That effort — including a major confirmation battle over Richard Cordray, the first director of the agency — fell short, but congressional Republicans have tried to impose more checks.

Rep. Sean P. Duffy, the Wisconsin Republican who was denied entry into a meeting of the bureau’s Consumer Advisory Board meetings in February, has written a bill that would require all Consumer Financial Protection Bureau advisory panels to abide by open-meeting laws so the public can know who is attending and what is being discussed.

Mr. Duffy said he doesn’t want to subject members to an ideological litmus test but that lawmakers should “know what kind of advice CFPB is getting from these boards.”

“Maybe that is why they don’t want us in the board meeting because they don’t want us to see the kind of advice they are getting from a socialist adviser and the actions that follow the socialist’s advice,” Mr. Duffy told The Times. “What are they hiding?”

The House this year passed another bill written by Mr. Duffy that would replace the bureau’s director with a five-member commission and subject it to regular appropriations. The bill passed on a 232-182 vote, with 10 Democrats joining the House Republicans.

The bureau is expected to face additional scrutiny Wednesday when a House financial oversight subcommittee holds a hearing into accusations of discrimination and retaliation within the Consumer Financial Protection Bureau.

Bureau officials angered Republican lawmakers by turning down invitations to testify. Democrats called for the meeting to be postponed.

Rep. Jeb Hensarling, Texas Republican and Financial Services Committee chairman, and Rep. Patrick T. McHenry, Colorado Republican and chairman of the subcommittee on oversight and investigations, denied the request Monday, saying they will protect the rights of whistleblowers who have come forward.

“Given your record of stated concerns over employment discrimination, we find it inexplicable that you are seemingly reluctant to investigate allegations of such conduct at a government agency that you would never countenance in the private sector,” the lawmakers said in a letter addressed to Rep. Maxine Waters of California and Al Green of Texas, the ranking Democrats on the House Financial Services Committee.

Copyright © 2016 The Washington Times, LLC. Click here for reprint permission.

blog comments powered by Disqus

 

Click to Read More

Click to Hide