Whatever else you may say about it, the Biden-Harris Administration will be more aggressive in consumer protection, with swift action expected on student debt, predatory loans and product safety, all given short shrift in the Trump Administration.
For evidence, look no further than Biden’s pick to lead the Consumer Financial Protection Bureau (CFPB), Rohit Chopra. He was the student-loan watchdog at the agency in the Obama Administration and has been serving as a member of the Federal Trade Commission during the Trump years.
The CFPB is largely the creation of Sen. Elizabeth Warren (D-MA), who has been outspoken in her support for reducing or forgiving student debt.
Student loan debt in 2020 is now pegged at about $1.56 trillion, owed by about 45 million borrowers. It’s the second highest consumer debt category, behind mortgages and way ahead of credit cards and car loans.
During its early years, the CFPB styled itself as the “cop on the beat,” riding herd on financial services companies, adopting strict new rules and imposing penalties on a long list of accused offenders. It backed off during the Trump years, reflecting Trump’s pro-business attitudes.
The Biden transition team said Chopra “has actively advocated to promote fair, competitive markets that protect families and honest businesses from abuses.”
If confirmed, Chopra would replace Kathy Kraninger, a Trump appointee who has run the CFPB since 2018, during which time numerous consumer protection measures were weakened or repealed.
New blood at the SEC
Besides Chopra at the CFPB, Biden has announced his intention to nominate Gary Gensler to head the Securities and Exchange Commission (SEC), “potentially giving Wall Street its most aggressive regulator in two decades,” according to a Wall Street Journal report.
Gensler is likely to support new regulations on public companies and to be more aggressive in pursuing enforcement cases against big companies and Wall Street banks. Gensler ran the Commodity Futures Trading Commission from 2009 to 2013, gaining a reputation as an aggressive and eager regulator.
Former Secretary of Labor Robert Reich said Chopra and Gensler were excellent picks. “Both will contain Wall Street greed. (If you took the greed out of Wall Street, all you’d have left is the pavement.),” he said in a Twitter post.
Specific policies aside, the Biden-Harris Administration has close ties to consumer protection officials, especially state attorneys general, who are consumers’ first-line defense against corporate abuse.
President Biden’s late son Beau was the attorney general of Delaware and was active in the National Association of Attorneys General, serving two terms as its president. Vice President Harris was attorney general of California from 2011 to 2017 and likes to say that, as such, she headed the second-largest Department of Justice in the U.S.
The Trump White House, like previous GOP administrations, was more closely allied with big business and thus reluctant to pursue aggressive pro-consumer policies. With the country’s two top elected officials both having long historic ties to consumer protection that’s not likely to be the case for the next four years.
It’s accepted lore among attorneys general that it was Beau Biden who introduced his father to Harris. The rest, as they say, is history.