- The Washington Times - Monday, June 18, 2018

Since its founding seven years ago by congressional Democrats and then-President Obama, the federal Consumer Financial Protection Bureau has been soaking taxpayers while supposedly protecting consumers from unscrupulous lenders.

The renovation of its 300,000-square-foot headquarters, across the street from the White House, is beset with cost overruns and is approaching $250 million, according to well-placed sources.

The agency also has spent more than $17 million on staff travel in 2017 alone, plus tens of millions in other years.

Against that backdrop of bureaucratic waste, battle lines formed in Washington on Monday over Kathy Kraninger, a White House budget official nominated by President Trump to be the new head of the CFPB.

If confirmed by the Senate, Ms. Kraninger would replace Mick Mulvaney, the Office of Management and Budget director who has been riding herd on CFBP’s costs and its aggressive regulatory action since he took over as interim director late last year. She is a disciple of Mr. Mulvaney who’s expected to carry out his view of more limited government.

Pointing to the new bureaucracy’s out-of-control expenses during the Obama years, a senior administration official said, “We need someone who has the management experience and the government background to end that waste.”

Some banking industry groups are supporting her nomination.

“Her experience at OMB alongside Acting CFPB Director Mick Mulvaney, along with her years of work on Capitol Hill and in the executive branch, would serve her well in this important position,” said the American Bankers Association. “We trust she shares our interest in ensuring consumers have access to the financial products they want and need, while maintaining the protections they deserve.”

Democrats and consumer advocacy groups are lining up against the selection of Ms. Kraninger.

“Working families need a @CFPB Director who will fight for them,” tweeted Sen. Sherrod Brown, Ohio Democrat. “For months I have called for a CFPB Director with a track record of holding Wall St & payday lenders accountable. The White House should pick an experienced, serious, independent leader.”

House Minority Leader Nancy Pelosi of California said Ms. Kraninger’s “apparent lack of experience in consumer finance, coupled with the administration’s hostility to consumer protection, raises questions about her qualifications to lead such an important agency.”

The advocacy group Public Citizen said Monday that Ms. Kraninger’s nomination signals that “Mick Mulvaney wants to continue to pull the strings at the CFPB.”

“In little more than six months of his improper leadership at the agency, Mulvaney has shut down enforcement, rolled back rules and demoralized staff — all to benefit big banks and predatory lenders,” said Lisa Gilbert, vice president of legislative affairs at Public Citizen. “If Kraninger is confirmed, we should expect more of the same. The American people deserve better.”

The White House said Ms. Kraninger is well-qualified to lead the consumer agency.

“Her work ethic and ability to get things done are comparable to none, and her subject matter expertise on a diverse range of issues, from financial services to homeland security and regulatory reform, will be extremely hard to replace,” said OMB deputy Director Russell Vought. “She will be a dogged advocate for American consumers and a tremendous leader for the bureau who will continue to restore credibility to an agency that has suffered from partisan politics for far too long.”

Under federal rules, Mr. Mulvaney would have had to leave the bureau by Friday if the president hadn’t nominated anyone for the job. Former House lawmaker Jim Nussle, a Republican who’s now president of the Credit Union National Association, said he expects “a bruising battle in Congress” over her nomination.

With the Senate confirmation process expected to take several months, Mr. Mulvaney will continue to wear two hats.

The confirmation battle will play out while the administration is still defending itself against a court challenge over whether Mr. Mulvaney should be running the agency at all. When Mr. Trump appointed him late last year to replace Democrat Richard Cordray, who’s now running for a Senate seat from Ohio, Mr. Cordray’s deputy, Leandra English, sued to be named the rightful director. A federal judge ruled in favor of Mr. Mulvaney, but the larger question of presidential authority has yet to be decided.

Some industry observers believe the White House is actually laying the groundwork to keep Mr. Mulvaney in charge of the consumer agency. Under the Federal Vacancies Reform Act, if Ms. Kraninger is not confirmed by the end of this year, when Congress ends its session, Mr. Mulvaney could begin to serve a second term of 210 days until another nominee is put forward.

Mr. Mulvaney has asked Congress to curtail the CFPB’s authority while he has engaged in a comprehensive review of the agency. In March, he asked for zero dollars in funding for the second quarter of the fiscal year, saying CFPB had enough money in reserves to operate. In April, he asked for $98.5 million for the third quarter.

“I don’t know if any director of any bureaucracy has ever come to you and said, ‘Please take my power away,’ but that’s what I’m doing,” Mr. Mulvaney told the Senate Banking Committee this spring. “And to the extent you can do that I think we will all be well served by it.”

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