More than a year after the passage of the financial reform, the Consumer Financial Protection Bureau still doesn’t have a director at the helm. Robert Cordray, former Ohio Attorney General, awaits confirmation, now stalled by Senate Republicans more interested in abetting the banks and gutting the bureau than in protecting consumers. This is bad not just for people looking to take out loans but for the country’s small businesses, too.
Every day the CFPB goes without a director, key lenders under its authority are left unregulated. At every turn, Senate Republicans have worked to weaken or limit the scope of the newly created Bureau. Cordray is eminently qualified, but every Senate Republican has signed a letter saying they won’t confirm any nominee until the CFPB is effectively gutted.
In 2010, Congress created the CFPB in the wake of the financial crisis that left millions of Americans under and unemployed all while transferring billions of dollars of wealth from working people into the hands of a few financiers. Its aim, unique among regulators, is to provide oversight to lenders with the best interest of consumers in mind. The Bureau has been tasked with regulating both bank and non-bank lenders.
This reflexive and ideological rejection of any director, no matter how qualified, will have dire consequences for small businesses and our local economies. That’s because what’s bad for consumers is also bad for small businesses. Small businesses need customers and until these customers are protected from the continued extraction of wealth by financial institutions from local economies we’ll continue to see high unemployment and small business districts littered with empty storefronts.
Until a director is appointed, non bank lenders such as payday and mortgage brokers continue to operate without oversight, as explicitly spelled out in the bill. Non-bank lenders such as payday will continue to siphon billions of dollars from local economies as they have for years.
Small businesses play an important role as the economic drivers of this country. The Senate needs to confirm Richard Cordray so the badly needed oversight by the CFPB can begin and small businesses can get back to hiring.