But after being neutered for four years under President Trump and his lackeys, the bureau is now ill-equipped to fully protect Americans from financial abuse. As one of his first acts, President-elect Joe Biden should rebuild the agency that the outgoing administration has torn down — and, as he might put it, build it back better. A good way to start is to nominate a true progressive with consumer regulatory chops, such as Mark J. Green, who was exactly that during his time as New York City’s consumer affairs commissioner and then its public advocate.
The CFPB’s roots show the promise of and the power vested in the agency. Originating out of a 2007 article written by Elizabeth Warren, who was then a Harvard professor, the bureau became reality with the passage of the Dodd-Frank financial regulation law in 2010. Over the course of the Obama administration, the CFPB returned almost $12 billion to the pockets of nearly 30 million Americans, helping them climb out of the depths of the 2008 recession.
With Trump’s election, the bureau became the fiefdom of Mick Mulvaney. Early on, Mulvaney warned, “Elections have consequences at every agency.” He made good on that promise: His tenure as acting director included a years-long hiring freeze, gutting the agency’s enforcement operations, an attempted defunding of the whole agency and even a bizarre effort to change the CFPB’s name.
By the end of his time at the bureau, Mulvaney’s efforts had contributed to a 96 percent decline in average relief to victims. His successor, Kathy Kraninger, hasn’t fared much better: Under her watch, the bureau has continued to roll back protections against payday lenders while turning a blind eye to the behavior of big banks.
The incoming Biden administration has an opportunity to restore the CFPB to its rightful place as what the New York Times once called “perhaps Washington’s most feared financial regulator” — and in so doing, gain a powerful weapon in the fight to weather this economic downtown. The agency can start by reviving Obama-era regulatory policies, such as restoring fair-lending investigations based on “disparate impact,” which grants the agency authority to investigate whether disparities exist in lending practices.
The new White House also can go further by pursuing aggressive action on the predatory practices of payday lenders and creating a public credit-reporting agency. “The CFPB has so many tools that it isn’t using right now,” Linda Jun, senior policy counsel at Americans for Financial Reform, recently noted. “If you get the right leadership in place, there is a lot that can be turned around.”
Which brings us back to Green, who started his career as a protege of consumer advocate Ralph Nader and has spent decades as a leader in consumer advocacy. (Disclosure: I have known Green for many years, and he has contributed articles to the Nation magazine, of which I am the publisher.) As the consumer affairs commissioner for New York City, Green raised both enforcement citations and restitution amounts for consumers. Just as importantly, he demonstrated skill at commanding national media pressure to force reforms, especially ones benefiting children, people of color and women. His work was instrumental in banning Joe Camel, exposing racial profiling by the New York City Police Department (earning then-Mayor Rudolph W. Giuliani’s ire), and protecting women in the marketplace and workplace with new laws concerning price discrimination, job discrimination and abortion drugs.
Over the past few weeks, Biden has faced countless decisions on staffing his administration, largely opting for well-respected moderate Democrats with experience in prior administrations. As director of the CFPB, Green would be a highly regarded progressive advocate who combines regulatory experience with a proven talent for using a public megaphone on behalf of consumers. Indeed, since Green helped push for a consumer protection agency in the 1970s, it would be poetic justice if he were chosen to run the only new federal consumer advocacy agency created in the past half-century.
Green’s appointment can both turn the page on the lethal inaction of the Trump administration and be politically responsive to those in Biden’s coalition looking for a person with his unquestioned liberal biography and talents. Or do only Republicans get to appoint ardent champions of their cause after winning the presidency? To quote Mulvaney, “Elections have consequences.”