Democrats will also question Kraninger on how likely she is to follow in the footsteps of Mulvaney, who they have accused of trying to tear down the agency from the inside.
The bureau is reconsidering its rule curbing payday lenders, and the agency’s disparate impact cases – in which discrimination does not have to be intentional to be considered illegal – are under review, Mulvaney said this spring.
President Donald Trump selected Kathy Kraninger, a little-known White House budget official, as the next director of the Consumer Financial Protection Bureau, setting up what is likely to be a bruising battle in Congress over the controversial young agency.
Kraninger works under Mick Mulvaney at the Office of Management and Budget. Her surprise selection to head the CFPB would ensure that Mulvaney, whose tumultuous six-month tenure as acting director of the bureau has drawn the ire of consumer advocates and Democrats, continues to have influence over the agency created in the wake of the financial crisis.
Any Trump nominee would have to survive a stormy confirmation process to lead the divisive consumer bureau, which was conceived and set up by Sen. Elizabeth Warren (D-Mass). Republicans have repeatedly tried to defang the watchdog, which they see as a symbol of executive overreach. Democrats see the agency – which is funded by the Federal Reserve and not subject to congressional influence over its budget – as the rare independent bulwark against the reach of big financial firms.
Kraninger "will bring a fresh perspective and much-needed management experience to the [bureau], which has been plagued by excessive spending, dysfunctional operations, and politicized agendas," White House spokeswoman Lindsay Walters said in a statement. "The White House hopes that she will be promptly confirmed by the Senate.”
The selection of Kraninger, an associate director at OMB, had not been widely expected before Friday night, when news of her likely nomination leaked. A Saturday evening announcement of a selection this important is highly unusual. It came a week before Mulvaney’s interim term is to end, and an announcement was initially expected next week.
Kraninger does not have a track record on financial policy. A senior administration official said the White House settled on someone without significant banking industry experience because they determined that problems with the bureau were mainly due to management issues.
The official said conservatives should embrace Kraninger because she has been part of Mulvaney’s efforts to redirect the agency’s mission. The White House expects strong Republican support for the nomination, the official said, given Kraninger’s history as an aide to several Republican senators and her strong relationships on Capitol Hill. Kraninger has held positions with both the House and Senate Appropriations Committees.
Still, the nomination is likely to spark a backlash from some conservatives who want a more well-known figure with stronger credentials in opposition to the CFPB’s very existence.
“It would be exactly like the Bush administration’s try at Harriet Miers for the Supreme Court and would end the same way,” J.W. Verret, a professor of Banking Law at Antonin Scalia Law School at George Mason University and former staffer for House Financial Services Committee Chair Jeb Hensarling, said in an emailed statement about Kraninger.
President George W. Bush nominated Miers, then a White House counsel, to fill a Supreme Court vacancy in 2005, but she withdrew her name after a barrage of criticism from both Republicans and Democrats over her lack of qualifications.
Kraninger’s OMB portfolio will draw pointed questions from Democrats. In her 15 months in that office, she was responsible for developing the budget of the Department of Housing and Urban Development, among other agencies. Congress has repeatedly ignored the Trump administration’s requests to slash HUD’s funding, boosting its appropriations instead.
Democrats will also question Kraninger on how likely she is to follow in the footsteps of Mulvaney, who they have accused of trying to tear down the agency from the inside.
Since being named acting CFPB chief, Mulvaney has slowed the pace of investigations, implemented a nearly six-month freeze on data collection and sought public input on almost every facet of CFPB operations, in what consumer advocates fear is a pretext for a major overhaul of everything from enforcement to examinations.
The bureau is reconsidering its rule curbing payday lenders, and the agency’s disparate impact cases – in which discrimination does not have to be intentional to be considered illegal – are under review, Mulvaney said this spring. And this week he said he was requesting a 20 percent budget cut for the agency for fiscal 2019.
Mulvaney has said he expects to stay on until the end of the year because of the slow pace of Senate confirmations.
Be First to Comment