Trump’s Pick for CFPB Dodges Senators’ Policy, Budget Questions

By Evan Weinberger

President Donald Trump’s nominee to lead the Consumer Financial Protection Bureau dodged most questions about her policy priorities and plans for cutting the bureau’s budget at a contentious July 19 confirmation hearing.

Kathy Kraninger, now an associate director at the White House Office of Management and Budget, frustrated Senate Democrats by refusing to discuss her positions on the CFPB’s payday lending rule, which is being reconsidered, and other policy areas that she wants to tackle if she is confirmed.Despite Democrats’ protests, Senate Banking Committee Chairman Mike Crapo (R-Idaho) said at the end of the hearing that he wants to have a vote on Kraninger’s nomination in early August.

Budget Dance

Kraninger demurred when Sen. Elizabeth Warren (D-Mass.) pressed her on how she plans to handle the CFPB’s budget. The CFPB is funded independently through the Federal Reserve and had a projected budget of about $630.4 million for fiscal 2018, according to the bureau’s 2017 strategic plan.

But the Trump administration proposed cutting the CFPB’s budget by about $147 million, or 23 percent, for fiscal 2019. Warren repeatedly asked Kraninger how she would accomplish that goal, since the Trump administration doesn’t have control over the CFPB’s budget.

Kraninger wouldn’t answer, despite Warren asking if she planned to cut civil service jobs, cybersecurity costs, or travel — which Warren pointed out would hurt the CFPB’s supervision of the financial sector.

Warren said she was frustrated by the game of dodgeball she was engaged in with Kraninger.

“The one thing you’ve done in your career related to the CFPB is to come up with a budget number, and the budget number simply doesn’t add up. You cannot explain how that agency can do its work with a 23 percent budget cut that you put together and the Trump administration offers as your expertise,” Warren said.

Warren said the only cut Kraninger affirmatively pointed to was in travel.

“I know that will make bank lenders happy, payday lenders happy. But it doesn’t reflect any knowledge of the CFPB or any commitment to the CFPB’s central mission of trying to protect consumers and level the playing field,” Warren said, pushing her microphone away in frustration after she was done.

Answers for the GOP

Kraninger said she is willing to make commitments to Republican members of the committee.

Kraninger told Sens. Jerry Moran (R-Kan.) and Pat Toomey (R-Pa.) that she would not use the enforcement process or guidance documents to put in place de facto rules. The CFPB under former Director Richard Cordray faced criticism from Republican lawmakers and the industry about the use of those two tools to set standards.

Instead, Kraninger vowed to rely on notice and comment rulemaking under the Administrative Procedure Act.

“It is critical to have clear rules so that the lenders and creditors and the consumers themselves know what the rules are and that they are not somehow told after the fact that they somehow broke a rule that they weren’t aware of,” Kraninger said.

Kraninger said she would lead the CFPB as the Dodd-Frank Act defines it but would be willing to work with lawmakers on potential changes to the bureau’s leadership structure and how it’s funded.

“I’m very open to changes in that structure that would make the agency more accountable,” she said.

To contact the reporter on this story: Evan Weinberger in New York at

To contact the editor responsible for this story: Michael Ferullo at

Copyright © 2018 The Bureau of National Affairs, Inc. All Rights Reserved.