This month, the CFPB’s chief architect Senator Elizabeth Warren officially announced the formation of her presidential exploratory committee. But Warren’s brainchild and main 2020 campaign talking point might be doing her more harm than good.
While still serving as a Harvard University professor, Warren spearheaded the Bureau’s creation through Congress’s Dodd-Frank Wall Street Reform and Consumer Protection Act. She believed that having a “watchdog” agency keep a close eye on wall street and other financial institutions would be a surefire way to protect consumers. Sadly, for Warren, the CFPB has been anything but a success.
Since its inception in 2010, the Bureau has issued more than $5 billion in penalties, punishing employers under the pretense of “protecting consumers.” In one year alone, credit unions took a $7 billion regulatory hit after accounting for revenue lost. For consumers, these additional and abusive regulations make it more difficult to receive much-needed loans for simple things such as covering rent or paying a utility bill.
Additionally, the Bureau has been deemed unconstitutional on more than on occasion. In a district court case, newly confirmed Supreme Court Justice Brett Kavanaugh had stated that, aside from the President, the Bureau was a “more unilateral authority than any other officer in any of the three branches of the U.S. Government.” He argued that the Bureau’s “combination of power” was “massive in scope” and triggered the question on constitutionality.
Unphased by this and other criticisms, Senator Warren continues to position herself as a proponent of the CFPB and a leading critic of the financial sector. But her role in shaping one of the most controversial and scandal-ridden agencies may come back to haunt her during her presidential campaign. Perhaps she would be better off discussing her DNA heritage.