On April 13, the House Financial Services Committee approved a bill by a 33-20 vote that is intended to end direct funding of the CFPB by the Federal Reserve and require the Bureau to be subject to the regular congressional appropriations process. This Committee joins others in approving similar measures that would institute a variety of reforms at the CFPB.
The CFPB is currently funded by revenue from the Federal Reserve and operates on a budget requested by the Director. The Taking Account of Bureaucrats’ Spending (“TABS”) Act, sponsored by Andy Barr (R-Ky.) would give Congress control over the CFPB’s budget, and it opens the door to Congress potentially defunding the Bureau.
House Financial Services Chairman Jeb Hensarling (R-Tex.), a staunch critic of the Bureau, noted that “[e]very government agency should be accountable to the elected representatives of ‘We the People’ and the CFPB should not be an exception to that rule. … It is a base matter of congressional oversight.” On the other end of the political spectrum, Democrat Rep. Maxine Waters (D-Calif.) insisted the TABS Act is intended to “repeal the very existence of the bureau.” “Whether it is protecting service members from financial predation, guarding students from fraudulent, for-profit schools, or establishing clear rules-of-the-road for payday loans, the Republicans stand in lockstep opposition,” said Waters.