Scott Powell and Jay Richards recently published a piece in Barron’s warning of the extensive authority and unchecked powers of the Consumer Financial Protection Bureau, established as a result of the Wall Street reform and Consumer Protection Act (aka Dodd-Frank).
This new regulator is the first to shed restraint from Congress, taking no interference in funding or oversight. Dodd-Frank gives its director unprecedented coercive power, without the checks and balances required by tradition and (we must hope) by the Constitution. In January 2012, the first director, Richard Cordray, was installed by President Obama in a controversial recess appointment made while Congress was still formally in session.
Apart from the disturbing lack of executive or congressional restraint on the CFPB, such a powerful regulatory body will surely lead to increased costs, reduced credit, and fewer jobs.
Read the whole article at Barron’s.