The Supreme Court on Monday agreed to hear a case that could help Republicans kneecap federal agencies, including one of the GOP’s favorite targets: the Consumer Financial Protection Bureau.
The appeal presents the latest test of how extreme the 6-3 Republican majority is, as the justices consider an outlier ruling from a panel of Donald Trump-appointed judges on the 5th U.S. Circuit Court of Appeals. The Biden administration told the Supreme Court that the ruling is “unprecedented” and “calls into question virtually every action the CFPB has taken in the 12 years since it was created.” Proposed by Democratic Sen. Elizabeth Warren, the bureau was established in 2011 to enforce consumer protection laws on everything from credit cards to student loans.
The 5th Circuit opinion was authored by Judge Cory Wilson, who was confirmed to the New Orleans-based appeals court by a 52-48 vote over civil rights opposition. President Joe Biden’s solicitor general, Elizabeth Prelogar, told the justices that the ruling “threatens to inflict immense legal and practical harms on the CFPB, consumers, and the Nation’s financial sector.”
The Trump-appointed panel justified the decision, which tossed out a payday lending rule, on separation-of-powers grounds. According to the 5th Circuit, the CFPB is constitutionally suspect because it’s not directly funded by Congress but instead by the Federal Reserve. Like former Vice President Mike Pence’s separation-of-powers justification in trying to avoid testifying about Trump and Jan. 6, the 5th Circuit ruling just so happens to advance GOP priorities. Indeed, though this case involves the CFPB, its reasoning could extend beyond the bureau to other government agencies and programs, which, again, would just so happen to align with the broader Republican goal of curbing business regulations.
How far that ruling goes in CFPB v. Community Financial Services Association of America is now up to the Supreme Court. But we may not find out until more than a year from now. NBC News’ Lawrence Hurley reported Monday: “Although the Biden administration had asked the court to fast-track the case, it will be decided in the court’s next term, which starts in October and ends in June 2024.”
That’s long enough to forget about the issue while awaiting the court’s further dismantling of affirmative action and voting rights this term, but it will be one to watch next term.
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