Is a More Powerful Consumer Bureau Watchdog Worth the Price?

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With their strengthened majorities in the next Congress, Republicans are likely to continue their attacks on the Consumer Financial Protection Bureau, which they blast as burdensome to business and too independent of oversight.

On Monday, the Congressional Budget Office released a score of a bill by Rep. Steve Stivers, R-Ohio—who was just reelected with 66 percent of the vote—to outfit the CFPB with a Senate-confirmed, independent inspector general. The verdict: a cost to the government of $49 million over the next decade.

The budget agency calculated that adding a more powerful IG would cost $100 million over 10 years, but that cost would be offset by the $51 million in savings from no longer funding an IG in the budget of the Federal Reserve System, which under the 2010 Dodd-Frank Financial Reform law shares its inspector general with the CFPB. The bill would require the president to nominate a dedicated IG within 60 days.

Inspectors general usually wear “two hats,” meaning they report both to Congress and to their agency but are supposed to operate independently.

When Strivers introduced the bill (H.R. 3770) in December, he said, “Government accountability is important now, more than ever. This legislation will allow for increased oversight of an agency that has been given broad authority.”

Before the bill cleared the House Financial Services Committee on June 11 by 39–20, Rep. Member Maxine Waters, D-Calif., the ranking member of the panel, said, “There is no evidence that the existing IG structure is inadequate,” according to a Bloomberg Government account. She said requiring Senate confirmation would bog down the agency given the two six-month periods it took to confirm its incumbent director, Richard Cordray.

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