Ever since Sen. Elizabeth Warren (D-Mass.) helped get the Consumer Financial Protection Bureau off the ground in 2010, Republicans have been trying to shut it down. GOPers drafted legislation to weaken the fledgling agency, which was designed to prevent mortgage lenders, credit card companies, and other financial institutions from screwing average Americans. The measures died. Republicans turned to the courts to gut the bureau. That effort failed. Now that Republicans control both houses of Congress, they have another weapon at their disposal: new subpoena powers they can deploy to blitz the CFPB with document requests.
The goal is obvious: dig out material the GOPers can use to embarrass the agency. And if nothing untoward is discovered, Republican legislators can at least pin down the bureau with onerous paperwork demands. Democrats fear Republicans' new information-gathering abilities will make it easier for the agency's foes to launch witch-hunt style investigations of the CFPB similar to those former House oversight committee chair Rep. Darrell Issa (R-Calif.) launched regarding Benghazi and the IRS.
All committees in both the House and the Senate have the right to subpoena federal agencies for information. But until recently, either the most senior committee member from the minority party had to sign off on a subpoena or the entire committee had to vote on the request. In the last Congress, six House committees okayed a rule change giving the committee chair unilateral subpoena power. On Tuesday, the House financial services committee—which has jurisdiction over the CFPB—voted along party lines to grant the same privilege to its Republican chairman, Jeb Hensarling of Texas.
Republicans already have a track record of looking for information that could tarnish the CFPB's reputation, and Democrats fully expect Hensarling to continue down the same path. And now Hensarling, a fierce CFPB critic, will be able to more easily mount politically motivated investigations of the agency.
Without the rule change, GOPers could still push through the subpoenas. As the majority, Republicans on the committee could vote to approve an information request. But with its new subpoena superpowers, the committee can demand records without a vote—and, thus, can keep the process from the public eye, a spokesman for the committee Democrats says. No longer will there be a public hearing where lawmakers can debate the subpoenas and Democrats can make a case if they think Hensarling and the Republicans are abusing the privilege. Last year, for example, ranking Democratic member Rep. Maxine Waters (D-Calif.) used the public forum to convince Hensarling to back down on a Treasury Department subpoena.
Now, if Democrats want to keep GOPers from going on a fishing expedition aimed at tarnishing the CFPB, they won't have as much of an opportunity to create a ruckus. At a committee hearing Tuesday, Waters, the senior Democrat on the panel, called the rules change "anti-democratic" and "insulting." (Under the new rule, Waters will be given 48 hours notice before Hensarling issues a subpoena, so that she can alert the press if she wants.)
"We think it’s ridiculous that the Republican leadership is exporting the Issa model to the rest of the House," a Democratic staffer told Politico. Several other House committees are expected to approve similar powers for their chairs this month.
Last year the GOP-dominated financial services committee voted to subpoena three CFPB officials to require them to testify in an ongoing investigation of alleged discrimination against minorities and women at the bureau. Democrats claimed the move was politically motivated.
Hensarling has not yet indicated how he might use the new subpoena powers. Some Republicans are unhappy with the CFPB's plan to crack down on shady payday lenders, so Hensarling could potentially subpoena the data the agency is collecting in an attempt to prove the effort is overly invasive. Hensarling denies the new rule is undemocratic.
The CFPB did not respond to a request for comment.
Nearly four years ago, while lifting pallets of blankets during an overnight stocking shift at Walmart, Barb Gertz began to notice a dull pain in her arms. She kept on lifting and stocking, but by the time her lunch break rolled around she could no longer raise her arms. Her doctor told her she had tendinitis in her biceps, and that it was most likely caused by her job. Walmart disagreed. The retailer contested Gertz's workplace-injury claim—and won.
If Gertz had worked in a factory, she could have bolstered her case with evidence from the Occupational Safety and Health Administration's national database of manufacturing workplace injuries. But no such database exists for retail workers like Gertz. A new regulation that OSHA is scheduled to finalize this year would change that. OSHA wants to create a public database of workplace injury and illness data from all industries, not just manufacturing. This would help workers, the government, researchers, and journalists identify companies with safety problems. But the trade groups that represent some of America's biggest chains—including Walmart, Target, and McDonald's—are fighting back hard.
The National Retail Federation—a group that represents Walmart, McDonald's, and The Container Store—spent $2.4 million lobbying on this measure and other issues between JanuaryandSeptember of last year. In a letter to OSHA last March, the group complained that the rule would require disclosure of confidential information, lay blame on employers for non-work-related injuries, be too costly, and empower unions. Last year, the Retail Industry Leaders Association, which counts Walmart, Target, and Home Depot among its more than 200 members, also urged the agency to kill the rule. The US Chamber of Commerce spent more than $28 million between July and September of last year on lobbying—including on this regulation, which the Chamber says is more burdensome on industry than OSHA will admit. And the Coalition for Workplace Safety, an association of trade groups that includes the Chamber, the NRF, and NILA, has asked OSHA to scrap the rule.
Walmart did not respond to a request for comment on whether the lobbying groups' stance on the regulation reflects its own. Nor did McDonald's, The Container Store, Home Depot, or Target.
All workplaces are already required keep internal paper records of worker injuries and illnesses. The new OSHA rule would simply require that all companies electronically submit that information to OSHA each quarter—just like manufacturing plants do already. "Industry says, 'Oh my God, we can't do that, it's really burdensome.' Well, they already have to keep these records," says Robyn Robbins, the assistant director of the occupational health and safety office at the United Food and Commercial Workers, a labor union that supports the change. She adds that many employers have already moved away from old-fashioned paper records and are keeping internal records electronically. All companies would have to do is submit those e-records to OSHA.
The regulation would apply to companies with more than 250 employees as well as smaller companies in high-hazard industries, such as freight trucking, construction, and waste collection. Businesses would be required to submit data including the job title of the employee, the type of injury, where it occurred, what the worker was doing before the incident, and the number of workdays the employee had to miss as a result. With the information, OSHA and employers "will be better able to…abate workplace hazards," an OSHA spokeswoman said in an email.
If such a database had existed when Gertz submitted her claim, it could have helped her build the case that her injury was work-related. "It will be easier to prove that it's not just [the worker], it's a company thing," she says. The OSHA measure "has great potential to allow workers to make the connection between the dangerous work they're doing and the work-related injuries that are occurring," Robbins says.
"I really hope [the regulation] goes through—for the benefit of all workers," Gertz says.
Update, Thursday, January 15, 2015: On Wednesday, the House passed this bill.
The Republican-dominated House is poised to approve legislation this week that would obliterate a slew of important Wall Street reforms. The legislation arrives just weeks after Congress and the Obama administration gave Wall Street two bighandouts, and serves as an opening salvo in what will be a sustained Republican assault on financial reform over the next two years.
The bill, introduced by Rep. Michael Fitzpatrick (R-Pa.), is called the Promoting Job Creation and Reducing Small Business Burdens Act, but its name obscures what it would actually do. The legislation is a compilation of deregulatory bills that failed to pass the Democrat-controlled Senate in the last Congress. It would alter nearly a dozen provisions of the 2010 Dodd-Frank financial reform law, loosening regulation of Wall Street banks. Here's a look at the details of what the bill would do.
Delay the Volcker rule. The Volcker rule—one of the most important bits of Dodd-Frank—generally forbids the high-risk trading by commercial banks that helped cause the financial crisis. One high-risk product banks are supposed to stop trading are collateralized loan obligations, which are bundles of loans that are broken into pieces and sold to investors. In December, the Federal Reserve extended banks' deadline to stop trading CLOs from 2015 to 2017. The Fitzpatrick bill would extend that deadline to 2019.
Water down rules on private equity firms. Private equity firms are required to register as brokers with the Securities and Exchange Commission (SEC) if they get paid for providing investment banking services such as merger advice. Brokers are subject to additional rules and more regulatory oversight. The bill would exempt some private equity firms from having to register as brokers.
Loosen regs on derivatives. Derivatives are financial instruments with values based on underlying numbers, such as crop prices or interest rates. The Fitzpatrick bill would allow Wall Street firms that own commercial businesses such as oil or gas operations to trade derivatives privately instead of in central clearinghouses, which are subject to more oversight. The bill would also forbid regulators from requiring that banks take collateral from companies that buy derivatives. Collateral can help offset losses if one of the parties involved in the transaction defaults.
Weaken transparency rules. The bill exempts about 60 percent of publicly traded companies from certain rules regarding how those companies must file financial statements with the SEC. The measure would also allow certain smaller companies to omit historical financial data in their financial statements. "This allows firms to choose a convenient history as they promote their securities," the consumer advocacy group Public Citizen noted last week.
Last week, House Republicans tried to force Fitzpatrick's bill through the House using a procedure typically used for uncontroversial bills or technical fixes. This process, known as fast-tracking, requires the bill to receive a yes vote from two-thirds of the chamber, or at least 290 members. But on Friday, just 276 of the 435 members of the House voted for the measure—well short of the two-thirds majority required. Now GOP leaders have resurrected the bill, and will push it through under the normal rules, which require just a simple majority. The bill is expected to pass the House easily, although it's unclear whether the Senate would approve it. President Barack Obama would likely veto it. But GOPers could force the legislation into law by attaching bits of it to must-pass bills—such as spending legislation—later this year.
The Fitzpatrick legislation signals the beginning of a sustained assault on Dodd-Frank by the new GOP Congress. Up next: the consumer protection bureau that Sen. Elizabeth Warren (D-Mass.) helped create. (More about that here.) "We're going to see repeated attempts to go in with seemingly technical changes that intimidate regulators and keep them from putting teeth in regulations," Marcus Stanley, policy director at the advocacy group Americans for Financial Reform told the New York Times this weekend. "If we return to the pre-crisis business as usual, where it's routine for people to accommodate Wall Street on these technical changes, they're just going to unravel the post-crisis regulation piece by piece. Then, we'll be right back where we started."
Residents stand outside burnt homes in Gambaru, Nigeria after a Boko Haram attack in May 2014.
Update, Thursday, January 15, 2015: New satellite imagery released by Amnesty International shows the extent of the devastation Boko Haram has visited upon northern Nigeria over the past week. Below are before and after images of the town of Doron Baga. Healthy vegetation is colored red.
The Islamist militant group may now control up to 20 percent of the country, according to NPR. Journalists are unable to report on the killing in the north, because approaching the area would be a "death wish," The New Yorker's Alexis Okeowo told host Melissa Block Tuesday.
Update, Friday, January 9, 2015:On Friday morning, Amnesty International said the latest Boko Haram attack could be the "deadliest massacre" in the group's history, if the early reports that as many as 2,000 people were killed turn out to be true.
This week, Boko Haram, the Islamist terror group based in northern Nigeria, launched a massive attack on the town of Baga, killing dozens, according to Reuters. Other initial reports put the number of dead in the hundreds or thousands. The attack is the latest in the group's increasingly bloody campaign to establish an Islamic state in the West African country. The group attained international infamy last April after it abducted some 300 girls. More than 200 of them are still missing.
Over the course of this Tuesday and Wednesday, the militants set fire to buildings in Baga and shot indiscriminately at civilians. Nearly the entire town was torched, according to the BBC. Baga, which had roughly 10,000 residents, is now "virtually non-existent," Musa Alhaji Bukar, a senior government official, told the British news agency.
Here's more from the BBC:
Those who fled reported that they had been unable to bury the dead, and corpses littered the town's streets, he said.
Boko Haram was now in control of Baga and 16 neighbouring towns after the military retreated, Mr Bukar said.
While he raised fears that some 2,000 had been killed in the raids, other reports put the number in the hundreds.
The attack follows an assault by Boko Haram on a military base in Baga on Saturday.
On Thursday, House Republicans will vote on an anti-Obamacare bill that could toss up to 1.5 million Americans off their employer-sponsored health plans. To make the case that this is a good idea, top GOPers are misrepresenting what the legislation would do. They claim the measure would help prevent companies from reducing worker hours in order to cut employees' health insurance benefits. Yet the legislation would likely encourage businesses to decrease hours so the firms could avoid providing health insurance to workers. "While political leaders often stretch the truth to make their case, they usually don't claim the opposite of the truth," Robert Greenstein, the president of the left-leaning Center on Budget and Policy Priorities (CBPP), noted Wednesday. "That, however, is essentially what Republican congressional leaders are doing."
The bill House Republicans introduced Wednesday would change the way the Affordable Care Act defines full-time work and, thus, who is eligible for employer-sponsored health care. Currently, the ACA requires companies with 50 or more employees to provide affordable health coverage to 95 percent of their full-time workers or pay a penalty. This measure, called the employer mandate, begins to go into effect this year. Under the 2010 health care law, full-time work is defined as 30 or more hours per week. The GOP bill would change the law's definition of full time to 40 hours per week.
Such a move would obviously lead to the loss of employer-sponsored health insurance for many people who work between 30 and 39 hours per week. But there's the bill would have another impact too: It would give employers a powerful incentive to cut the hours of Americans who work 40-plus hours per week to escape the obligation to provide them health insurance. And health care policy experts note that it is more likely that a firm would slice the hours of a 40-hours-per-week worker than an employee who toils 30 hours a week. (More on that below.) Changing the full-time threshold to 40 hours would put some 1.5 million Americans at risk of having their hours docked and their insurance yanked, according to a recent report by the Congressional Budget Office.
Yet top Republicans are claiming the opposite. On Tuesday, Rep. Paul Ryan (R-Wis.) said the bill would enable "more people [to] work full time." Late last year, House Speaker John Boehner (R-Ohio) and Senate Majority Leader Mitch McConnell (R-Ky.) argued the measure would protect the 40-hour work week by "removing an arbitrary and destructive government barrier to more hours and better pay created by the Affordable Care Act."
As I reported Monday, here's why companies would be more likely to reduce workers' hours under the GOP bill's 40-hour threshold than under the current 30-hour per week cutoff:
The 30-hour threshold was intended to discourage companies from cutting workers' hours. Nearly half of Americans work 40 hours a week or more—meaning that, under current law, employers would have to cut those workers' hours by more than 25 percent to avoid buying them health insurance. But if the threshold were 40 hours, as the GOP envisions, many employers would only have to cut workweeks a tiny bit to avoid buying health insurance for their employees. "Raising the threshold to 40 hours would place more than five times as many workers at risk of having their hours reduced," Paul van de Water, a senior fellow at the [CBPP], wrote in 2013.
A flock of prominent conservatives—including political analyst Yuval Levin and columnist Ramesh Ponnuru—have also chimed in against the 40-hour bill.
On Wednesday, President Obama vowed to veto the law if the Senate approves it. But that doesn't mean the bill won't become law. It's possible that Republicans will attach the measure to a must-pass spending bill this year that would be extremely difficult for Obama to oppose.