Consumer finance watchdog avoids getting defunded in Trump's big bill
A Senate official decided that Republicans can't nix the Consumer Financial Protection Bureau in their big bill
The seal of the US Consumer Financial Protection Bureau (CFPB) at the agency's headquarters in Washington, DC. (Al Drago/Bloomberg via Getty Images)
A top Senate official decided that Republicans can't defund the Consumer Financial Protection bureau and other regulators in President Donald Trump's megabill, according to Democrats on the Senate Banking Committee.
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Senate parliamentarian Elizabeth McDonough ruled that a GOP measure in the legislation to zero out federal funding for the consumer finance watchdog, in tandem with other provisions to scrap the Public Company Accounting Oversight Board and the Office of Financial Research. Another would have shrunk Federal Reserve staff pay.
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The parliamentarian said those were beyond the boundaries of the stringent Senate maneuver known as reconciliation, the fast-track budget process the GOP is employing to circumvent unanimous Democratic opposition. The official serves as an influential, behind-the-scenes arbiter of reconciliation. She ruled against Democrats as well in 2021.
“We will continue examining every provision in this Great Betrayal of a bill and will scrutinize it to the furthest extent," said Sen. Jeff Merkley of Oregon, the ranking Democrat on the Senate Banking panel, in a Friday statement. Merkley added Democrats are pushing to ensure Republicans don't stray from reconciliation's stiff rules compelling that its provisions directly affect federal spending levels.
The parliamentarian's decision dealt a blow to GOP aims of shrinking the CFPB, an independent agency that oversees banks and other major lenders. Under the Trump administration, the CFPB has experienced mass layoffs induced by the Elon Musk-led Department of Government Efficiency and other changes to its mandate.
Senate Republicans said they're still pursuing funding cuts to the CFPB in other pieces of Trump's megabill. "I remain committed to advancing legislation that cuts waste and duplication in our federal government and saves taxpayer dollars," Senate Banking Chair Tim Scott of South Carolina said in a statement.
Republicans are aiming to meet an ambitious, self-imposed deadline to send the megabill to Trump's desk by July 4. GOP senators say they intend to vote on the legislation next week.