Column: GOP lawmaker, pockets stuffed with bank cash, leads assault on consumer bureau
Texas Republican Jeb Hensarling, who chairs the House Financial Services Committee, was trying to be funny. It’s the only explanation.
Otherwise, we’re left to assume that Hensarling was being the world’s biggest corporate shill and hypocrite when he accused the head of the Consumer Financial Protection Bureau of “abusing his authority.”
In a contentious hearing this week that bordered on outright abuse, Hensarling told CFPB Director Richard Cordray that “the president is clearly justified in dismissing you and I call upon the president – yet again – to do just that, and to do it immediately.”
“American consumers need competitive markets and a cop on the beat to protect them from fraud and deception,” he snarled. “They don’t need Washington elites trampling on their freedom of choice and picking their financial products for them.”
Make no mistake: Hensarling doesn’t give a damn about American consumers and he sure as hell isn’t pushing for a “cop on the beat” to keep banks in line. What he wants is to liberate his deep-pocketed corporate patrons from regulatory oversight that’s resulted in billions of dollars being reimbursed to customers.
According to the Center for Responsive Politics, Hensarling, 59, has been raking in cash from the financial sector since he was first elected to Congress in 2003.
The top single donor to his campaign efforts over the years is JPMorgan Chase, which has contributed $106,686. The second-biggest donor is Bank of America, which has ponied up $86,250.
Hensarling’s third-biggest donor is the rest of the banking industry in the form of the American Bankers Assn., which has given him $85,300.
On an industry basis, he’s received $1.3 million from commercial banks, $1.4 million from securities and investment firms, $1.4 million from insurers and $703,304 from finance and credit companies.
And this is a guy with consumers’ best financial interests at heart?
“Jeb Hensarling has a long, long list of contributions from banks and Wall Street firms,” Sally Greenberg, executive director of the National Consumers League, told me. “He and his committee have set their sights on the CFPB because the CFPB has been so successful at protecting consumers from being ripped off.”
Since it opened for business in 2011, the bureau says it has recovered about $12 billion fleeced from consumers via illegal and questionable financial practices. It has overseen a revamping of mortgage rules, proposed new regulations for payday lenders and held dozens of firms accountable for fiscal misdeeds.
I contacted the Financial Services Committee and said that a consumer advocate had suggested Hensarling might be influenced by his industry ties. I asked if they’d like to respond.
Sarah Rozier, a committee spokeswoman, first wanted me to name the consumer advocate, although why that should matter was a mystery. All she had to do was say, no, Hensarling isn’t influenced by the millions of dollars he’s received from financial firms.
So I passed along Greenberg’s name and, an hour later, Rozier sent an email dismissing Greenberg’s organization as “a liberal group backed by labor unions.”
Instead of explicitly denying that Hensarling is influenced by the money he gets from financial firms, Rozier said that “Chairman Hensarling led the fight against the Wall Street bailout in Congress.” She also said that legislation proposed by Hensarling would impose “the toughest penalties in history for those who commit fraud and insider trading.”
Hensarling and his Republican colleagues, in their first face-to-face encounter with Cordray since the November election, spent nearly five hours on Wednesday treating the CFPB chief like a pinata.
The tone for the beat down was set early when Hensarling said he was surprised that Cordray had shown up, even though the CFPB director is required to do so twice a year when the House Financial Services Committee requests his presence, which it did.
In his next breath, Hensarling told Cordray, a former Ohio attorney general, that he’d half-expected him to be in his home state running for governor, which he isn’t. “Perhaps the rumors of your political aspirations are greatly exaggerated,” Hensarling remarked.
Republicans feel that Cordray has too much power and acts with impunity. They’re emboldened by a recent court ruling that declared the CFPB’s leadership structure unconstitutional. However, that decision will be revisited by the U.S. Court of Appeals.
“This tyranny must end,” Hensarling declared at Wednesday’s hearing, reaching deep into his muddy bucket of hyperbole.
He and other Republicans want to replace the bureau’s single director with a more easily influenced committee and want to control the CFPB’s budget, which of course would make it vulnerable to industry lobbying.
After the Republicans had taken turns getting in their licks, frequently denying Cordray a chance to respond, Rep. Michael Capuano (D-Mass.) commented, “Boy, they really hate you, don’t they?”
Cordray replied that “it’s part of the game.”
It’s not a game. If the CFPB were derelict in its mission of consumer protection, lawmakers would have every right to demand changes. But the bureau’s track record is one of unqualified success — much to the consternation of big-money banks and financial firms.
“Chairman Hensarling is furious at the CFPB because it’s working, protecting consumers and holding banks and lenders accountable for their actions,” said Christine Hines, legislative director for the National Assn. of Consumer Advocates.
“He’s made it clear that his leadership on the Financial Services Committee is strictly for the industry’s benefit,” she said.
Of all House members running for reelection last year, Hensarling was the second-largest recipient of contributions from commercial banks ($274,900), topped only by Republican House Speaker Paul Ryan ($344,399), the Center for Responsive Politics found.
Rep. Keith Ellison (D-Minn.) seemed to put his finger on things when he told Cordray that this week’s hearing was little more than political theater.
“It’s not really about any of this stuff,” he said. “It’s about the CFPB diverting money to the pockets of working Americans and not financial interests.”
You can take that to the bank.