Does Trump’s Budget Include Secret Plan to Defund and Eliminate Consumer Bureau?
Trump Budget Assumes Funding Source of Consumer Financial Protection Bureau (CFPB) Will Change, Then Entirely Eliminates Funding
WASHINGTON, D.C. – Today, President Trump released his Fiscal Year 2018 Budget that, while providing few concrete details, presumes the Consumer Financial Protection Bureau (CFPB) will no longer be funded by the Federal Reserve, but will instead be funded by taxpayers. This assumption allows the administration to entirely eliminate funding for the Consumer Bureau–which is exactly what Trump’s budget proposes.
Currently, the CFPB doesn’t cost taxpayers a dime because it is funded through the Federal Reserve and not through congressional appropriations. The Trump administration’s proposed change appears to put taxpayers on the hook for funding the CFPB and then, in a supposed attempt at cost savings and deficit reductions, eliminates funding for the bureau entirely. It amounts to little more than a ploy to destroy the consumer watchdog altogether.
“Leave it to Donald Trump to come up with inventive ways to screw over hard-working American families. His proposed budget amounts to little more than a ploy to completely eliminate the Consumer Bureau, which has returned nearly $12 billion directly to 27 million consumers who have been taken advantage of by banks, credit card companies, debt collectors, and other financial predators,” said Karl Frisch, executive director of Allied Progress.
He continued, “The only people who will benefit if Trump successfully defunds and eliminates the Consumer Bureau are his buddies on Wall Street. Big banks and predatory lenders would be given free rein to prey on hard-working men and women who don’t have millions of dollars to buy off members of Congress.”
The section on page 158 of the budget entitled, “Restructure the Consumer Financial Protection Bureau,” seeks to “limit the Agency’s mandatory funding in 2018, and provide discretionary appropriations to fund the Agency beginning in 2019,” although there are no details provided to explain shifting the CFPB’s funding source from its current structure that costs taxpayers nothing. Based on the annual cost savings in the funding summary, the budget projects to recoup all of the Consumer Bureau’s operational expenses beginning in FY 2019 by essentially eliminating the Consumer Bureau entirely. The bureau’s 2017 budget is $646.2 million, with Trump’s budget projecting to eliminate $6.8 billion in CFPB funding over the next ten years.
The Trump Budget release comes on the heels of the passage of the Financial Choice Act by the House Financial Services Committee. The act, sponsored by Wall Street-funded Rep. Jeb Hensarling (R-TX), also calls for the dismantling of the Consumer Bureau and would cost $1.8 billion to implement, according to the Congressional Budget Office.
To speak with Karl Frisch about Trump’s budget and the Consumer Bureau’s funding, please contact Tucker Middleton at 202-644-8526 or tucker@alliedprogress.org.
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Allied Progress is a nationwide, progressive advocacy organization that uses hard-hitting research and creative campaigns to hold Wall Street and powerful special interests accountable. Since launching in 2015, the organization has led high-profile campaigns on several issues including reforming the payday lending industry and exposing the those working to cripple the Consumer Financial Protection Bureau.