Since President Obama nominated Richard Cordray as Consumer Financial Protection Bureau director in early January, the controversy surrounding that recess appointment has spanned Washington—and beyond. But what about the constitutionality of the bureau itself? Republican presidential candidate Rep. Ron Paul (R-Texas) weighed in on the CFPB, its director, and keeping Wall Street “in check” in an editorial published Tuesday on the Daily Bell.
Housed within the unconstitutional Federal Reserve, and funded not through Congressional appropriations but through the Federal Reserve’s interest revenue off the trillions of dollars of U.S. government debt it holds, the structure of the CFPB ensures that it is run by unelected, unaccountable bureaucrats, with no effective oversight from Congress. Given broad power to regulate the activities not only of banks, but also of any other entity which the government deems offers a financial product, there is almost no limit to the scope of financial activities which the CFPB can oversee.
…But rather than keeping Wall Street in check as its proponents allege, the CFPB will end up placing further restrictions on the ability of Main Street Americans to engage in productive financial endeavors. Current law already allows only the richest Americans to invest in potentially lucrative ventures such as hedge funds because such investments are deemed to be “too risky” for the average American to invest in. The government in its paternalistic wisdom treats American investors as too stupid to know what to do with their own money, and “protects” them, supposedly, by keeping them poorer than they otherwise would be. We can expect even more of this once the CFPB is running in full stride.
View the editorial on the Daily Bell.
Written by Elizabeth Ecker