The CFPB Must Go

Barack Obama made government even bigger and more unbearable during his presidency. One of his lasting “achievements” was the Consumer Financial Protection Bureau (CFPB), an agency first proposed by Elizabeth Warren. On the surface, its purpose is to safeguard citizens from dubious financial practices. In reality, the CFPB imposes left-wing priorities on the market that harm the ordinary consumer.

Thankfully, many in Washington want to cast Warren’s brainchild into the dustbin. In January, House Republicans introduced a bill to defund the agency. Elon Musk recognizes the harm in the agency and has stuck DOGE on it. Last week, the Senate voted to strike down a CFPB rule, imposed in the final days of the Biden administration, that limited bank overdraft fees. This week, the House is set to vote on repealing that same rule, which, by forcing banks to tighten their belts, would unduly punish low-income Americans and force them to use sketchy payday loans instead.

Donald Trump and Musk have prioritized eliminating DEI and wokeness from the government. CFPB is an agency built on these principles. Consider its commitment to tackling “disparate impact.” This is a left-wing legal theory that postulates, regardless of intent, that racially disproportionate outcomes prove discrimination. The agency cites the fact that blacks and Hispanics are more likely to be hit with overdraft fees as a reason to crack down on them. Any racial disparity is proof enough for the CFPB’s intervention. It doesn’t matter whether it’s a natural result of the market—the left-wing bureaucrats view it as a serious problem.

This insidious focus has long been at the heart of the CFPB’s activity. Richard Cordray, CFPB’s first director, declared back in 2012 that one of the agency’s core missions was tackling disparate impact on behalf of “communities of color.” One of its first targets under this distorted thinking was the car loan industry. CFPB claimed in 2013 that the loans amounted to discrimination because there were “disparities between the interest rates paid by African American, Hispanic, and Asian car buyers compared to the interest rates paid by white car buyers.” The agency relied on poor research to make this argument, but that didn’t stop the bureaucrats from forcing businesses to make hefty payouts over the matter.

The CFPB expanded its focus on disparate impact under Biden, aggressively targeting lenders and other companies for practices that unintentionally resulted in racial disparities.

Prior to the second Trump administration, the agency was zealous in its devotion to DEI. Besides going after lenders over disparate impact, it also sought to pressure financial institutions to favor minorities for credit assistance. Companies, such as Chicago-based Townstone, faced the wrath of federal power if they failed to accede to the demands for racial favoritism.

As Trump’s acting CFPB director Russ Vought notes:

CFPB abused its power, used radical ‘equity’ arguments to tag Townstone as racist with zero evidence, and spent years persecuting and extorting them—all to further the goal of mandating DEI in lending via their regulation by enforcement tactics. The more we uncover at CFPB, the more we see how this agency was weaponized against targeted Americans.

The agency’s new leadership further explained the DEI ideology guiding Sen. Warren’s creation:

To CFPB, a disparity automatically equaled discrimination. CFPB targeted Townstone not based on any act of discriminatory conduct, but solely on perceived racial disparities in mortgage application and origination statistics. That disparity? An agency-defined “shortfall” of just 31 applications from “majority-minority” areas, out of 876 total applications in a three-year period. CFPB wanted a de facto mortgage quota, a policy aligned with the views of radical DEI proponents like Robin DiAngelo and Ibram X. Kendi. Townstone had even hired loan outreach officers to go to minority communities, but this did not satisfy the CFPB, which claimed they weren’t the right type of minority. In 2022, CFPB Director Rohit Chopra said “racial equity” was a “cross-cutting priority,” and Townstone was internally tagged as a target important for that priority.

It makes sense why Musk wants to delete the agency. It harms businesses on behalf of insane left-wing theories. It’s why it must go.

Congress’s actions against CFPB and its draconian rules are warranted. To make America great again, we need to cut out the useless bureaucrats and allow businesses to do what makes market sense—not what satisfies the dictates of DEI.