CFPB and White House Strategic Plans Appear to be Aligned

CFPB Acting Director Mick Mulvaney released 5-year strategic plan for the Bureau yesterday.  This plan is a revision (or major overhaul of) the plan issued by former Director Richard Cordray last fall, and opens with a message from the Acting Director stating,

“…it became clear to me that the Bureau needed a more coherent strategic direction. If there is one way to summarize the strategic changes occurring at the Bureau, it is this: we have committed to fulfill the Bureau’s statutory responsibilities, but go no further.”

Here is a link to the draft 35-page plan released by Cordray for public comment in October 2017.

Here is a link to the full 14-page plan released by Mulvaney (the plan notes that performance goals and measures would be moved to the Annual Performance Plan and Report, which explains why this plan is less than half the length of the former one).

Here is a link to the 2013-2017 40-page plan released by Cordray.

Both the Cordray draft plan and the Mulvaney plan begin with the same listing of the five areas of authority granted to the CFPB by Dodd-Frank:

1. Consumers are provided with timely and understandable information to make responsible decisions about financial transactions;
2. Consumers are protected from unfair, deceptive, or abusive acts and practices and from discrimination;
3. Outdated, unnecessary, or unduly burdensome regulations are regularly identified and addressed in order to reduce unwarranted regulatory burdens;
4. Federal consumer financial law is enforced consistently in order to promote fair competition; and
5. Markets for consumer financial products and services operate transparently and efficiently to facilitate access and innovation.

The interpretations, however, diverge from there.

The Cordray mission: The CFPB helps consumer financial markets work by making rules more effective, by consistently and fairly enforcing those rules, and by empowering consumers to take more control over their economic lives.

The Mulvaney mission: To regulate the offering and provision of consumer financial products or services under the Federal consumer financial laws and to educate and empower consumers to make better informed financial decisions.

The Cordray vision: If we achieve our mission, then we will have encouraged the development of a consumer finance marketplace:

• where consumers can see prices and risks up front and where they can easily make product comparisons;
• in which no one can build a business model around unfair, deceptive, or abusive practices;
• that works for American consumers, responsible providers, and the economy as a whole.

The Mulvaney vision: Free, innovative, competitive, and transparent consumer finance markets where the rights of all parties are protected by the rule of law and where consumers are free to choose the products and services that best fit their individual needs.

The Mulvaney goals:

1. Ensure that all consumers have access to markets for consumer financial products and services.
2. Implement and enforce the law consistently to ensure that markets for consumer financial products and services are fair, transparent, and competitive.
3. Foster operational excellence through efficient and effective processes, governance, and security of resources and information.

The Cordray goals:

1. Prevent financial harm to consumers while promoting good practices that work for consumer, responsible providers, and the economy as a whole.
2. Empower consumers to make informed financial choices to reach their own life goals and enhance their own financial well-being.
3. Inform the public, policy makers, and the CFPB’s own policy-making with market intelligence and data-driven analysis of consumer financial markets and consumer behavior.
4. Advance the CFPB’s performance by maximizing resource productivity.

Both make reference to efficiency. However the new Acting Director places top priority on a free and competitive market, while the former Director focused first on identifying good and bad practices in order to prevent harm to consumers.

Meanwhile, President Trump released his own strategic plan this week, in the form of his 2019 budget proposal. According to The Washington Post, under the President’s plan, the CFPB would be funded through Congress rather than the Federal Reserve. The Post also notes that the Trump plan caps the CFPB’s 2019 budget at the 2015 level of $485 million, rather than the projected $630 million for 2018. Given that Mick Mulvaney is also the President’s Budget Director, it would appear that these strategic plans are working in sync. Over the last two months the Acting Director has cancelled enforcement efforts, opted out of funding, and other actions which would align with this budget reduction strategy.

Also swirling around this week is a rumor that President Trump wants to replace White House Chief of Staff John Kelly and is considering Mick Mulvaney for the job. This would be Mulvaney’s third job… unless he gives up the other two, which would once again send leadership of the CFPB into question. Trump has yet to pick a nominee for the permanent CFPB Director job, and former Director Cordray’s Chief of Staff, Leandra English, is still suing to serve in the Acting role.

On Face the Nation this past Sunday, Mick Mulvaney says nobody from the White House has discussed the Chief of Staff role with him, nor would he want it. You can listen here: