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S. 1335 (116th): Repeal CFPB Act

Has the main new agency created in the wake of the ’08 crash done more good or harm?


In the aftermath of the 2008–09 financial crash, congressional Democrats enacted the Dodd-Frank Wall Street Reform and Consumer Protection Act. Almost every congressional Republican opposed: only three Senate Republicans and three House Republicans voted in favor.

One of the law’s main provisions established a new government agency called the Consumer Financial Protection Bureau, or the CFPB. Critics on the right contend that the agency stifles business with its heavy-handed regulations of the financial and banking industries.

What the bill does

The Repeal CFPB Act would do exactly what its name implies: abolish the Consumer Financial Protection Bureau.

Their budget this fiscal year is $533.0 million, so ostensibly taxpayers would save that much per year if the bill was enacted. However, the bureau’s defenders argue instead that the long-term cost to American consumers would outweigh the amount saved upfront through eliminating the CFPB’s annual budget, since the bureau actually saved American consumers at least $11.8 billion.

It was introduced in the Senate on May 6 as bill number S. 1335, by Sen. Ted Cruz (R-TX).

What supporters say

Supporters argue the CFPB is an example of government bureaucracy and business limitations run amok, with negative repercussions for the American economy.

“There has never been a greater farce and waste of government resources than the Consumer Financial Protection Bureau, and now is the time to eliminate it,” Sen. Cruz said in a press release. “Make no mistake, it does little to protect consumers and was created during the Obama administration to enforce burdensome regulations, which have stunted economic growth and negatively impacted small businesses and consumers.”

What opponents say

Opponents counter that the bureau has helped American consumers, and undermining or even abolishing the agency would only embolden the financial institutions which brought the economy to a near collapse only a decade ago.

“Over the past few weeks, the administration has dismissed enforcement actions, delayed the payday lending rule and halted the investigation of Equifax,” former CFPB Director Richard Cordray wrote in a February 2018_Washington Post_ op-ed. “Calling for the CFPB to act with more ‘humility,’ [CFPB’s then-director Mick] Mulvaney has taken up the cause of financial industry cheaters who have done — and continue to do — great harm to the American people.”

“This behavior toward the CFPB — and agencies across Washington — has starkly exposed the falsity of candidate Trump’s grandiose campaign promises about taking on the corrupt interests that prey on working Americans and their families,” Cordray said.

Odds of passage

The bill has attracted seven Senate cosponsors, all Republicans. It awaits a potential vote in the Senate Banking, Housing, and Urban Affairs Committee. The committee is led by Sen. Mike Crapo (R-ID), who has not cosponsored the legislation, even as he has been a harsh critic of the CFPB.

GovTrack Insider previously covered the Financial CHOICE Act, a Republican bill to make major reforms to the CFPB, including allowing financial institutions to receive more exemptions from regulations and replacing the agency’s director with a five-person board. But even most Republicans, it seems, are not considering actually eliminating the bureau entirely.

Sen. Cruz introduced the legislation in the two previous Congress sessions as well. The 2017 version attracted seven Republican cosponsors, while the 2015 version attracted one Republican cosponsor. Neither version received a committee vote.

Last updated Jun 10, 2019. View all GovTrack summaries.

The summary below was written by the Congressional Research Service, which is a nonpartisan division of the Library of Congress, and was published on May 6, 2019.

Repeal CFPB Act

This bill repeals the Consumer Financial Protection Act of 2010, which established the Consumer Financial Protection Bureau.