Supreme Court Nominee Considers the Consumer Financial Protection Bureau Unconstitutional

Sep 6, 2018 | News

Brett Kavanaugh, President Trump’s Supreme Court nominee to replace the now-retired Justice Anthony Kennedy, has faced rounds of questions this week from members of the U.S. Senate’s Judiciary Committee. Although Kavanaugh has been somewhat evasive on certain topics, he stood firmly by his position that the Consumer Financial Protection Bureau (CFPB) is unconstitutional as it is currently structured.

More specifically, Kavanaugh believes that the CFPB is unconstitutional because it has a single director whom the President can fire only for cause, and not at will. Although this may be an unpopular position among Democrats on the committee, it should come as no surprise.

In 2016, Kavanaugh was a judge on the D.C. Court of Appeals that ruled on PHH Corporation v. Consumer Financial Protection Bureau. For that case, Kavanaugh wrote the majority opinion that found that the CFPB was “unconstitutionally structured.” Kavanaugh went even further asserting that the director of the CFPB is the second most powerful government official, behind only the U.S. president.

As recently as early 2018, Kavanaugh has written that the CFPB is unconstitutional. Unlike the CFPB, “the heads of executive agencies are accountable to and checked by the President; and the heads of independent agencies, although not accountable to or checked by the President, are at least accountable to and checked by their fellow commissioners or board members,” Kavanaugh writes in a recent dissenting opinion. “No independent agency exercising substantial executive authority has ever been headed by a single person…Until now.”

Kavanaugh is not the only one questioning the CFPB’s constitutionality. Over the summer, senior U.S. District Judge Loretta A. Preska ruled that the structure of the CFPB is unconstitutional and, as a result, the agency should be abolished. Mirroring Kavanaugh’s criticisms, Judge Preska found the CFPB unconstitutional because the agency was headed by a single director who served a five-year term and could be fired by the president only for cause.

Although his position on the CFPB won’t find much support among Democrats, Kavanaugh only needs a simple majority vote in the Senate after a rule change last year that ended the 60-vote threshold needed for Supreme Court nominees. Still, Republicans only hold 51 seats in the Senate, making the eventual confirmation fight far from over.

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