President Trump surprised purveyors of speculation over the weekend by selecting a White House budget office associate to be the permanent director of the ever-controversial Consumer Financial Protection Bureau.
Kathy Kraninger, a former Senate appropriations staffer with a homeland security specialty, “will bring a fresh perspective and much-needed management experience to the [consumer bureau], which has been plagued by excessive spending, dysfunctional operations and politicized agendas,” Deputy White House Press Secretary Lindsay Walters said in a statement provided to Government Executive. “As a staunch supporter of free enterprise, she will continue the reforms of the bureau initiated by acting Director Mick Mulvaney, and ensure that consumers and markets are not harmed by fraudulent actors.”
Budget director Mulvaney, whose tenure doubling as head of the bureau is set to end on June 22, re-abbreviated the agency’s name as BCFP for Bureau of Consumer Financial Protection. He may now stay at the bureau for another 210 days under the Federal Vacancies Reform Act now that the president is submitting a long-term nominee.
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Reaction to Kraninger’s name was mixed in the consumer activist and banking communities. The Marquette University graduate with a law degree from Georgetown University Law Center monitored five mostly homeland security-related agencies as associate director at OMB.
American Bankers Association President and CEO Rob Nichols said in a statement, “Her experience at OMB alongside acting CFPB Director Mick Mulvaney, along with her years of work on Capitol Hill and in the executive branch, would serve her well in this important position. We trust she shares our interest in ensuring consumers have access to the financial products they want and need, while maintaining the protections they deserve.”
But Lauren Saunders, associate director of the National Consumer Law Center, said Kraninger “does not appear to have any consumer protection experience that qualifies her to lead an important agency that oversees the largest banks and protects the public from risky mortgages, tricks and traps, and other abuses by Wall Street giants.”
Equally skeptical was Public Citizen, whose financial policy advocate Bartlett Naylor said, “Trump and Mulvaney continue to convert an agency Congress designed to protect Americans from consumer abuse into one that enables such abuse. ...The nation’s leading consumer financial regulator is not an entry-level job,” he added. “The Senate must win a convincing pledge that Kraninger will honor the statutory mandate of this vital consumer protection agency and not be a Mulvaney puppet.”
Karl Frisch, executive director of Allied Progress, called the move “nothing more than a desperate attempt by Mick Mulvaney to maintain his grip on the CFPB, so he can continue undermining its important consumer protection mission on behalf of the powerful Wall Street special interests and predatory lenders that have bankrolled his career.” Frisch accused the White House of “waiting for the last possible moment to announce a nominee and then selecting someone whose resume of relevant experience is basically nonexistent. Buys them more time with Mulvaney at the helm.”
Criticism was also heard from conservatives. As The New York Times reported, J.W. Verret, a law professor at George Mason University and a former top aide to the House Financial Services Committee, compared her nomination to the 2005 debacle for Harriet Miers, who was unsuccessfully nominated to the Supreme Court by President George W. Bush. “This job is too important for word-of-mouth recommendation alone,” he said.
An administration official told the Times that Kraninger’s “low-key” style would draw attention away from Mulvaney’s aggressive approach to regulatory policy changes.