President Trump’s budget proposal includes a section that would quietly defund the Consumer Financial Protection Bureau. The defunding portion of the proposal is veiled in a larger passage calling for a structure change to the CFPB.
The proposed budget outlines a $6.8 billion cost savings related to the CFPB over the next 10 years. Interestingly though, the CFPB’s budget only runs about $600 million a year. Therefore, the cut is really a death sentence for the bureau, which has been a serious thorn in the side of the financial and banking industries since its implementation. By design, the CFPB has operated autonomously, without congressional oversight, since was enacted in 2010 as a part of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
Financial institution representatives claim it places undue burdens on companies in the financial services industry.
Remember however, the President’s proposed budget is exactly that: A proposal. It represents his administration’s wish list for government spending, and any finalized budget plan must pass both houses of Congress before it can become law. In light of the prevailing winds in congress, the likelihood of that ever happening are slim to none. The Republican party is not all on board with Trump’s proposals. Two key Republican senators, John Cornyn of Texas and John McCain of Arizona, separately declared the proposal “dead on arrival.”