No rules for progressive radicals

Bureau of Consumer Financial Protection Director Rohit Chopra speaks at a Senate Banking, Housing and Urban Affairs Co...


Bureau of Consumer Financial Protection Director Rohit Chopra speaks at a Senate Banking, Housing and Urban Affairs Committee hearing in Washington, DC on October 28.


Photo:

Rod Lamkey / Zuma Press

Progressives break institutional norms left and right to impose their agenda. On Thursday, the director of the Consumer Financial Protection Bureau (CFPB), Rohit Chopra, went so far as to attempt a de facto coup against the president of the Federal Deposit Insurance Corporation (FDIC), Jelena McWilliams, appointed by Trump.

Mr Chopra wants to use bank merger reviews to exert greater political control over lending. The Bank Merger Act of 1960 requires the Federal Reserve Board of Governors, the Office of the Comptroller of the Currency, and the FDIC to consider the “convenience and needs of the community to be served” when considering proposals for fusion.

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Democrats are using this provision as a toll booth to coerce loans to preferred causes in return for merger approval. But Ms McWilliams, who was appointed in 2018 to a five-year term as president, has refused to take the banks hostage. Since Mr Chopra has no authority over bank mergers as the director of CFPB, he tries to override Ms McWilliams on an irregular basis.

Mr. Chopra is an ex-officio member of the FDIC Board of Directors, as is Acting Currency Comptroller Michael Hsu. Martin Gruenberg, a holdover from Obama who chaired “Operation Choke Point”, is also on the board. It was the FDIC and Justice Department’s lobbying campaign to restrict banking access to politically unpopular sectors, including payday lenders and gun dealers.

While Ms. McWilliams is three times the number of the Liberals, FDIC regulations have long given the president the ability to set the board’s agenda. The Liberals cannot put any regulatory change or action to a vote without his consent. Mr. Chopra ignored these rules.

Our sources say Mr. Chopra demanded in late October that the FDIC issue a request for public comment on how to toughen bank merger reviews. A request for public comment is the first step in changing the agency’s procedures or regulations. While disagreeing with her view that merger reviews were too lenient, McWilliams agreed, in a spirit of collegiality, to ask career staff to draft a request for public comment. Mr. Chopra was not satisfied.

While career FDIC staff worked, Mr. Chopra lobbied for his own proposal. On the Friday after Thanksgiving, a CFPB staff member shared with members of the FDIC board of directors his proposal for a request for public comment. His proposal included guiding questions such as whether the director of the CFPB should be consulted on mergers.

Fast forward to this week. FDIC staff sent MPs on board members their own proposal for public comment as well as critical comments on the office’s draft on Monday. MM. Chopra and Gruenberg sought to vote in favor of the office version anyway, which they couldn’t do without the president’s approval. Then they released a statement falsely claiming the board had approved it.

The FDIC was quick to publish a correction: “The Consumer Financial Protection Bureau (CFPB) posted on its website a document, allegedly approved by the FDIC, soliciting comments on bank mergers. No such document has been approved by the FDIC “and” there has been no valid vote of the Council “and no request for public comment” has been approved by the agency for publication in the Federal Register ”.

As the FDIC noted, the board has “a proud history of 88 years of board members working together collegially” despite “countless philosophical differences on substantive issues among board members over the years.” . Simply put, Mr. Chopra’s coup attempt is unprecedented.

Mr. Hsu’s role is somewhat obscure. We are told that he initially agreed with MM. Chopra and Gruenberg, but had doubts. He could be a candidate for another executive position that requires confirmation from the Senate. The comptroller’s office issued a statement that Mr. Hsu “has paid close attention to the Bank Merger Act” and “will continue to work collaboratively with other regulators on this and other matters.”

***

This race around institutional norms is standard procedure for Mr. Chopra, a protégé of Elizabeth Warren. Politico reported that on his last day as a federal trade commissioner, he emailed up to 20 “zombie votes.” These will allow him to dictate the FTC’s agenda after he leaves despite his current 2-2 partisan split. He’s trying to run the CFPB, FTC, and FDIC at the same time.

All of this is worth keeping in mind as senators consider Mr Biden’s candidate for the Federal Communications Commission, Gigi Sohn, who has a long record of vehement partisanship. The White House is also counts

Richard Cordray, another student of Ms. Warren and mentor of Mr. Chopra, will be vice president of oversight at the Fed.

Democrats have criticized President Trump for breaking political standards, but his appointees have mostly followed the regulatory process. Mr. Biden’s rushed radicals are ready to overturn the norms to impose their agenda.

Potomac Watch: Stacey Abrams lost the Georgia governor’s 2018 race to Republican Brian Kemp, and to date she has never accepted the result. In 2022, the Progressive Democrat will take it up again, although his main focus is still on ‘voter suppression’. Images: AP / Getty Images Composite: Mark Kelly

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Published in the print edition of December 11, 2021.

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