Top House lawmaker questions validity of consumer bureau funding … Obama has renominated Cordray, who will have his Senate confirmation hearing Tuesday, and nearly all Senate Republicans have promised again to block him. − Los Angeles Times
Dominant Social Theme: This new bureau will really help make US consumers prosperous again.
Free-Market Analysis: Why do US consumers need protection from the private sector? Shouldn't competition winnow out the bad guys and reward the good?
And if the CFPB is a bad idea – and from a free-market standpoint it certainly is – then why don't federal legislators continue to oppose it based on its inevitable failures and anti-business presumptions?
Here's how Wikipedia describes the mission and history of the Consumer Financial Protection Bureau:
According to the bureau's own webpage, "The central mission of the Consumer Financial Protection Bureau (CFPB) is to make markets for consumer financial products and services work for Americans—whether they are applying for a mortgage, choosing among credit cards, or using any number of other consumer financial products."
Why is Washington DC in the business of making consumer financial products "work for Americans?" This shows us once again how far the US market-conversation has departed from the free-market principles on which the US Constitution is supposedly based.
When one looks at the variety of government regulators now in place in Washington DC, one is staggered by the array. There are 16 different intelligence agencies apparently under the Homeland Security umbrella and probably twice as many regulatory agencies. This isn't merely a leviathan-in-the-making, it is the actual behemoth fully arrayed.
It is true that Republican legislators have indicated disapproval of the CFPB on philosophical grounds. But even here the criticism has been hedged rather than emphatic, as the Times reports. And this attack is purely technical:
Senate Republicans have been blocking the confirmation of a director, which led Obama to use a recess appointment to install Richard Cordray as the bureau's head last year.
House Financial Servics Committee Chairman Jeb Hensarling (R-Texas), a leading critic of the agency, wrote to Federal Reserve Chairman Ben S. Bernanke last week asking for clarification about the funding of the bureau.
Under the financial reform law, the Fed provides the money to run the bureau. Hensarling said the law authorizes the Fed to transfer the money "only at the request" of the bureau's director, according to the letter released Tuesday.
In light of January appeals court ruling calling into question the validity of Obama's recess appointment of Richard Cordray as bureau director, the Federal Reserve Board might not be able to transfer the money.
Republicans are trying to scuttle an appointment based on various political maneuverings that the Bush administration probably utilized as well. But the larger issue is the accretion of regulatory democracy itself – and how it undermines the Constitutional legitimacy of the current federal government.
Kentucky Senator Rand Paul recently led a filibuster against potential drone strikes on American citizens without due process. It caused a stir because Paul was actually taking action legislatively based on a philosophical (Constitutional) position.
If Republicans would regularly employ the rhetoric of freedom and free-market principles rather than involve themselves in bureaucratic/Congressional infighting, the party would likely be seen in a more favorable light.
Granted this is a PR point that will not change the fundamental direction of the US as it plunges toward evermore political activism and authoritarianism. But public rhetoric does occasionally have a salutary impact on civil society … plus it is one of the only weapons that Republicans can use that is both cheap and efficient.
Rand's approach, from a purely presentational standpoint provides us with the proverbially "better idea."