Elected Missouri Republicans in Washington and Jefferson City are aiming to take down a consumer agency.
Ballwin GOP Congresswoman Ann Wagner, who was assigned to chair a financial services subcommittee this year, has her sights on a federal office set up after the great recession.
Her panel held a hearing Tuesday titled “The Bureau of Consumer Financial Protection’s Unconstitutional Design”.
The agency is funded by the Federal Reserve, and is therefore largely insulated from congressional oversight. Wagner contends the resulting lack of checks and balances is unconstitutional.
Meanwhile, Republican state Attorney General Josh Hawley filed a brief in federal court earlier this month, also arguing the bureau is unconstitutional. 14 other states joined in on the brief ahead of an appeals court hearing.
A lower court had ruled to agency to be unconstitutional because it’s headed by a single director not accountable to any elected official. That ruling resulted from a lawsuit by a mortgage company, which is fighting a $109 million fine from the bureau.
Hawley has further criticized the agency for hurting Missourians for years with out of control regulations.
“Government bureaucracies shouldn’t be able to impose burdensome regulations on small business and local banks without political accountability” said Hawley. “Reforming this blatant violation of the separation of powers is essential to preserving the Constitution’s model of accountable, democratic government.”
In the committee headed by Rep. Wagner, Republicans sought to find a way for President Trump to fire the bureau’s director, Richard Cordray.
Although he initially said he had no immediate plan to oust Cordray, Trump has made the dismantling of the Dodd-Frank financial law a priority. The consumer bureau is a product of that law.
During the Tuesday hearing, Wagner said the agency was regulating outside it’s authority “to the detriment of consumers”.
Democrats on the committee countered that Republicans were attempting to reign in the agency as a move to protect business interests.
According to the Center for Responsive Politics, Wagner received nearly $364,000 from the banking and financial industries in the last election.
The Missouri Democratic Party blasted Wagner following the hearing.
In a statement, chairman Stephen Webber said if Wagner’s “idea of holding Washington accountable is firing a top consumer watchdog, unleashing Wall Street, and siding with the big banks over Missouri’s working families – then Missourians have good cause to wonder whose side she’s on.”
The consumer bureau is now working on ways to regulate payday lending, where high interest loans often impoverish borrowers. The city of Springfield reached out to the bureau last year for that very reason, asking it to crack down on the lenders.
Since it started in 2011, the Consumer Financial Protection Bureau has retrieved $11.8 billion for 29 million consumers due to illegal business practices.