Senate Parliamentarian Deals Setback to Proposal to Defund CFPB

Republicans’ plan to defund the Consumer Financial Protection Bureau (CFPB) as part of President Donald Trump’s tax and spending bill, the “Big, Beautiful Bill,” has suffered a setback by the Senate parliamentarian.

The parliamentarian ruled that this and several other proposals violated Senate rules that require the legislation to include only measures that affect the U.S. budget, the Financial Times (FT) reported Friday (June 20).

Other proposals rejected by the parliamentarian included a plan to scrap the Public Company Accounting Oversight Board and transfer its powers to the Securities and Exchange Commission, to cut the pay of Federal Reserve officials and to reduce spending on the Treasury Department’s office of financial research, according to the report.

The parliamentarian’s ruling means that Senate Republicans must remove these provisions of the bill if they want the bill to be able to pass with a simple majority vote, The Hill reported Friday.

If they leave the provisions in, the bill will require 60 votes, according to the report. Senate Republicans hold 53 seats in the Senate.

Senate Majority Leader John Thune, R-S.D., has indicated that he does not plan to pursue a third option: a vote to override the parliamentarian’s ruling, per the report.

The chairman of the Senate Banking Committee, Sen. Tim Scott, R-S.C., said in a Friday press release that discussions with the Senate parliamentarian are ongoing and that Scott remains committed to cutting waste and duplication in the federal government.

“As it stands now, the Banking Committee’s reconciliation provisions will delay the implementation of Section 1071 of Dodd-Frank, which reduces CFPB spending and protects the privacy and data of small business owners; rescind unused funds earmarked for green initiatives to give HUD discretion in funding critical housing programs; and save taxpayer dollars by eliminating an unnecessary reserve fund at the SEC,” Scott said. “My colleagues and I remain committed to cutting wasteful spending at the CFPB and will continue working with the Senate parliamentarian on the Committee’s provisions.”

The ranking member of the Senate Banking Committee, Sen. Elizabeth Warren, D-Mass., said in a Friday press release that the proposal rejected by the parliamentarian are “reckless” and “dangerous.”

“These proposals are a reckless, dangerous attack on consumers and would lead to more Americans being tricked and trapped by giant financial institutions and put the stability of our entire financial system at risk — all to hand out tax breaks to billionaires,” Warren said. “Democrats fought back, and we will keep fighting back against this ugly bill.”