Don’t Let Wall Street Run Amok

AP Photo/Jacquelyn Martin

Rich Cordray, director of the Consumer Financial Protection Bureau

Ten years ago, just before the onset of the financial crisis, I wrote an article for an academic journal proposing a new agency that would regulate financial products and protect American consumers. I set my expectations low: This idea would go nowhere.

But after the financial system imploded, there was sudden interest in my idea from that dusty academic journal. I started to talk to groups about building a consumer agency, and one after another came on board: unions, AARP, Consumers Union. The giant financial institutions were dead set against it—and they spent more than $1 million a day lobbying against the new agency and tougher financial rules. It was David-versus-Goliath all the way, but in 2010 President Obama signed the Consumer Financial Protection Bureau (CFPB) into law.   

As I was setting up this new agency, I asked Rich Cordray to help. He agreed to come to Washington just temporarily to build the CFPB’s new enforcement team—and he ended up staying for seven years. Rich was the agency’s first director, and he has done a terrific job.  

Under Rich’s leadership, the CFPB has forced big financial institutions to return more than $12 billion to 29 million Americans. That’s money that veterans, students, seniors, and working families can use to pay the rent or buy some new clothes for the kids or save for an emergency.

The agency has also handled more than one million consumer complaints, helping countless people resolve issues with their banks and credit card companies, and putting money back in their pockets.

The agency has transformed the market for financial services. With its new rules on mortgages, credit cards, checking accounts, prepaid cards, and payday loans, the CFPB has helped clean up some of the most predatory practices and knocked bad actors out of the industry altogether. 

But from the day it opened its doors, the agency has been under attack from the banking industry and its Republican friends in Congress. You would think that the financial industry would be discredited after blowing up the economy and causing a massive recession, but no: Members of Congress are still eager to please them and still take their false claims at face value.

Rich recently announced that he would be leaving the CFPB, and the question of Rich’s successor is a big test for Donald Trump. When he was Candidate Trump, he made repeated promises on the campaign trail, to “not let Wall Street get away with murder” and “stand up for the little guy.” That’s the mission of the CFPB—to stand up for American families and against Wall Street. 

If President Trump chooses another industry hack or bought-and-paid-for politician to lead this agency—either on a temporary or a full-time basis—it will be an unmistakable sign that he will run government to benefit his rich buddies, not working families.

We’ve already been through one big fight to create the Consumer Financial Protection Bureau. The biggest and baddest lobbyists and banks in the country were lined up against the agency, but Americans demanded it, and it became a reality. 

Now, it’s time for round two. The next leader of the CFPB will determine whether the agency continues to fight for consumers—continues to put real money back in the pockets of American families—or whether it will be another industry lapdog that lets the biggest banks run wild. 

The CFPB doesn’t have a ready-made lobbying group. It can’t call on deep-pocket Wall Street banks to persuade their friends in Congress to support the agency. Instead, it is up to us. Up to us to demand that this agency continue its mission of protecting consumers. To demand that Donald Trump not appoint some industry hack or bought-and-paid-for politician to lead this great agency. To demand someone with a demonstrated track record of protecting consumers and holding financial firms accountable. To demand a government that stands up for fairness and for America’s families. 

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