One of the central provisions of the Dodd-Frank financial reform package was the creation of the Consumer Financial Protection Bureau, which is charged with preventing banks and other financial institutions from preying on vulnerable consumers. Republicans hate the CFPB, and have taken to complaining about its funding stream, which comes from the Federal Reserve rather than the normal budgeting process.
They have a point, but they have only themselves to blame, since the GOP has all but relinquished its claim to responsible oversight by using the budget to cripple laws it doesn't like.
This steaming Washington Examiner editorial lambasting Reps. Maxine Waters (D-Calif.) and Al Green (D-Texas) is a helpful distillation of the GOP position:
Simply put, Waters and Green view the congressional appropriations process as an obstacle to doing things they judge to be good, rather than as a tool by which the American people make sure the executive branch properly enforces the laws they instructed Congress to approve. This is how a democratic republic functions. Do Waters and Green think other agencies — say, the IRS, NSA, the Department of Homeland Security or perhaps the FBI — should be similarly unaccountable to the people's representatives?
And what will they do when, having freed the bureaucrats of congressional shackles, they find a Republican president using the CFPB in nefarious ways, with Congress powerless to intervene? [Washington Examiner]
I have some sympathy with this perspective. Putting the CFPB outside the normal budget does reduce its democratic accountability. And the agency hasn't been covering itself with glory of late; a recent report from American Banker found systematic discrimination in hiring and promotion. It's plausible that more oversight could have prevented that.
But the problem is that conservatives obviously aren't concerned about whether taxpayers are getting a good deal. They want to cut the bejesus out of the agency's funding, even if it means inviting another financial crisis. The GOP budget from earlier this year zeroed out CFPB funding after 2016. Republicans claimed they wouldn't get rid of it altogether, but given the GOP's animosity toward pro-consumer regulations, or any programs that benefit the non-rich, it's easy to suspect that they are trying to quietly axe the agency.
The truth is that the strongest possible oversight authority over the CFPB — the power of life and death — is still firmly in Congress' hands. The legislature created the agency, and it may destroy it. The trouble is that Republicans don't have enough votes to destroy the CFPB. They don't even have a majority in the Senate, never mind enough votes to override a guaranteed veto from President Obama.
By dividing government, the Constitution forces parties into compromise. For a normal partisan with a basic commitment to the norms of American democracy, the idea is to hammer out compromises with the other side until you are in a position to enact a suite of policies. You can't get everything, but you can get half a loaf here and there. Then, when you get the rare chance at controlling both Congress and the presidency, you pass a big policy suite, and hope people like it enough that it sticks.
That's a reasonably fair description of how Democrats behaved from 2006 to 2010.
But Republicans have abandoned this set of norms in favor of an enraged constitutional hardball. Under this model, when you don't have enough votes to pass your agenda, you use every procedural tactic at your disposal to force the other side to embrace it. At the extreme, this includes threatening grievous damage to the nation, by deliberately defaulting on the debt or shutting down the government. Additionally, since what passes for Republican policy is simply repealing laws or privatizing huge swathes of the government, starving agencies for funds is a nice way to accomplish that goal on the sly.
Republicans have eased up on the government-by-hostage-crisis of late, but this behavior is what inspires Democrats to do an end-run around the budget process. Since they can't trust Republicans to not use the budget process as part of the policy proxy war, there's a constant search for ways to protect critical agencies from procedural extremism.
It's not a great situation. But because our poorly designed institutions have collided with a galloping conservative radicalism, it is going to be a more common one.
