Byron York at the Washington Examiner revealed some interesting activity that went on late last week in the House Financial Services Committee during a vote on the Consumer Financial Protection Agency (CFPA). According to CNN, "[t]he consumer agency would be a brand new regulator whose chief concern is looking out for consumers. It would write rules aimed at ensuring that financial products like mortgages and credit cards are fair, more transparent and more easily understood." Spencer Bachus (R-AL) led the Republican opposition to the legislation, arguing that it "would create a massive government agency headed by a czar-like director with the power to ration consumer credit and impose taxes and fees on small businesses." (Please click here for the Republican alternative.)
York explains that, [a]lthough the proposed Consumer Financial Protection Agency . . . has nothing to do with community organizing, Democrats offered an amendment that could allow ACORN and groups like it to participate in the new agency. Republicans offered an amendment of their own, designed to stop the Democratic one." Here is where the trickery came in:
The bill creates two boards. One, the Oversight Board, will be the key panel giving advice to the director of the new agency. The bill says the Oversight Board will have seven members and specifies who those members will be: the chairman of the board of governors of the Federal Reserve; the head of the agency responsible for chartering and regulating national banks; the chairman of the Federal Deposit Insurance Corporation; the chairman of the National Credit Union Administration; the chairman of the Federal Trade Commission; the Secretary of the Department of Housing and Urban Development; and the chairman of the liaison committee of representatives of state agencies to the Financial Institutions Examination Council.
That's the Oversight Board. The bill would also create a second board, the Advisory Board, which would offer general advice to the director of the new agency. The bill does not specify how many members the Advisory Board will have, nor who they will be. It just says they should be "experts in financial services, community development, fair lending and civil rights, and consumer financial products or services."
The Oversight Board . . . is clearly the more powerful of the two boards. Since the makeup of the Oversight Board is specified in the bill, Republicans did not expect Democrats to try to open up that board to include openings for ACORN and similar groups. Instead, Republicans expected Democrats to offer an amendment which would make it possible for representatives from ACORN and other groups to serve on the Advisory Board. With that in mind, Republicans prepared an amendment of their own banning ACORN from the Advisory Board. (The central part of the amendment did not go after ACORN by name, but barred individuals from organizations that have been indicted for federal or state election law violations from serving on the board.)
It turns out Republicans were mistaken. … Democratic Rep. Maxine Waters introduced an amendment that would add five members, not to the Advisory Board, but to the Oversight Board, with all five chosen from among "experts in the fields of consumer protection, fair lending and civil rights, representatives of depository institutions that primarily serve underserved communities, or representatives of communities that have been significantly impacted by higher-priced mortgage loans." That description could easily fit ACORN, or any number of other pro-Democratic groups. In any event, these new members would serve alongside the top officials from the Fed, FDIC, HUD, and the rest of the Oversight Board. Waters did not waste her time with the lower-level Advisory Board; she went straight for the top, the Oversight Board.
But Republicans had prepared an amendment which covered just the Advisory Board. "We can only anticipate what she's going to offer," says Rep. Michelle Bachmann, who introduced the Republican amendment, referring to Waters. "We anticipated the Advisory Board."
Committee Chair Barney Frank (D-MA) was quick to what was going on and "quickly order[ed] a vote on the amendments." The committee approved the bill (with the amendments) by a vote of 39 to 29. However, the issue is not yet settled:
Bachmann knows that Democrats managed to open up the Oversight Board to ACORN and other groups without even being forced to publicly defend the decision. Now, she hopes they will be forced to vote up or down on a proposal to bar ACORN from the Oversight Board. "What we're going to try to do is offer an amendment when the bill goes to the floor," says Bachmann. "That's the goal -- to keep people who are from ACORN from serving on the Oversight Board."
Whether or not the creation of the "Consumer Financial Protection Agency" is a wise idea can be reasonably debated. However, can a member of Congress say with a straight face that a representative from an organization like ACORN should sit on a board with that kind of power and oversight?