With less than 30 days to go before July 21st - the Designated Transfer Date and the day on which the Bureau will inherit much of its considerable power - the Bureau remains the center of substantial controversy. Here is the latest:
INSIDE THE BUREAU
Elizabeth Warren, Harvard professor, Bureau transition team lead, and oft-cited front-running Obama appointee to be the Bureau's first director, said last week that "We really are an agency. We're not an implementation team anymore. We're there."
Steven Antonakes, former Massachusetts Commissioner of Banks, vice chairman of the Conference of Bank Supervisors, and the lead of the Bureau's depository supervision unit, announced at the American Bankers Association conference that "We are all engines ready to go." Antonakes' supervisory territory includes 111 banks, thrifts, and credit unions, which control about 80% of the banking assets in the United States. As for the exams, Antonakes said that clean exams will result in the Bureau staying away for about two years. If the Bureau discovers "issues," expect to see the Bureau more frequently.
Christopher Haspel, the former director of the mortgage-backed securities monitoring division at Ginnie Mae, has reportedly joined the Bureau as a "senior official."
The House Appropriations Committee advanced a bill that would limit the Bureau's funding to $200 million in 2012. If it passed, it would strip the Bureau of one of its most significant independent features: funding through the Federal Reserve budget and not by appropriation. The Committee's rationale for the proposed limitation is transparency for and accountability to the U.S. taxpayers. Pamela Banks, senior policy counsel for the Consumers Union, counters that if the Bureau's budget becomes part of the appropriations process, it will become politicized.
A group of GOP Representatives -- including House Financial Services Committee Chairman Spencer Bachus (Alabama), House Committee on Oversight and Government Reform Chairman Darrell Issa (California), Shelley Moore Capito (West Virginia), Scott Garrett (New Jersey), Patrick McHenry (North Carolina), and Randy Neugebauer (Texas) -- sent a letter to Treasury Secretary Tim Geithner requesting that the Bureau turn over records related to its involvement settlement talks related to bank foreclosure practices. The lawmakers' concern is that the Bureau's participation in the negotiations went beyond its statutory authority.
In the Washington Times, Robert P. Murphy scathingly argues that the Bureau is unnecessary and "will be a bust":
"The CFPB's proposed interventions into the consumer financial market may sound nice in theory, but will yield unintended consequences. . . . The ultimate solution to potential greedy businesses is the discipline of market competition. . . . It's naive to think a new federal bureau - whether headed by Elizabeth Warren or another Mother Teresa - will successfully avoid future crises and stay one step ahead of unscrupulous players. The best bet for consumers is to educate themselves and be prudent in spending and borrowing. The lesson for the feds is to learn from history and let the market weed out unscrupulous firms."
Adam Levin, chairman of Credit.com and the former director of New Jersey's Division of Consumer Affairs argued "in defense of consumer protection" in ABC News/Money. In support of his argument, he laid out his "greed and stupidity-domino theory" of financial ruin:
Collective greed and stupidity begat years of irresponsible borrowing, lending and spending; which begat overly aggressive remedial institutional response such as mind-numbing ill-conceived foreclosures, frenzied short sales, indiscriminate account closings and ubiquitous credit line cramdowns; which begat the extinction of millions of small, medium and large economic enterprises deemed small enough to fail; which begat shrinking 401ks, collapsing consumer confidence and economic ruination for millions of Americans; which begat the terrifyingly ballooning government deficit; which could beget the S&P downgrade of America's credit standing; which will beget the Chinese and our other fair-weather friends fleeing our shores in search of the next best investment. . . .
Meanwhile, Marcus Baram at the Huffington Post advanced the position that regulation has long-benefitted the financial services industry, and that there is no reason to believe that the same prosperity will not follow for the Bureau's regulatory reign