What A Day - Why Trump Wants To Shutter The Consumer Financial Protection Bureau

Episode Date: February 11, 2025

The Consumer Financial Protection Bureau has become the latest federal agency in the Trump administration's crosshairs. On Friday, unelected billionaire Elon Musk and his minions gained access to the CFPB's computer systems. That same day, the White House named Russell Vought, the newly confirmed head of the Office of Management and Budget and longtime opponent of the CFPB, as the agency's new acting director. The next day, Vought ordered CFPB staffers to halt all work and to close the office, effectively shuttering the independent agency created in the wake of the 2008 financial crisis. Helaine Olen, managing editor at the American Economic Liberties Project and a contributing columnist at MSNBC, explains why shuttering the CFPB would be bad for average Americans.And in headlines: Trump doubles down on his plan to kick Palestinians out of Gaza, a federal judge says the White House has defied his order to unfreeze billions in federal grants, and the president slaps a 25 percent tariff on steel and aluminum imports.Show Notes:Check out Helaine Olen's piece – https://tinyurl.com/4h97vk99Subscribe to the What A Day Newsletter – https://tinyurl.com/3kk4nyz8Support victims of the fire – votesaveamerica.com/reliefWhat A Day – YouTube – https://www.youtube.com/@whatadaypodcastFollow us on Instagram – https://www.instagram.com/crookedmedia/For a transcript of this episode, please visit crooked.com/whataday

It's Tuesday, February 11th. I'm Jane Coaston and this is What a Day, the show that has decided it has heard too many Taylor Swift, Travis Kelce conspiracy theories. On today's show, President Donald Trump doubles down on his plan to kick Palestinians out of Gaza. And a federal judge says that the White House has defied his order to unfreeze billions in federal grants. But let's start with the administration's push to dismantle the Consumer Financial Protection Bureau. If you viscerally remember the 2008 financial crisis, you know why the Consumer Financial Protection Bureau was created.

The gross combination of predatory lenders, financial institutions running amok, and a housing bubble led to the biggest financial downturn in the United States since the Great Depression. I graduated from college during that time, as did millions of Millennials, and if you ever wondered why people around my age are the way we are, well, it wasn't the avocado toast we were all allegedly purchasing. Anyway, the Consumer Financial Protection Bureau was created to protect consumers from the scams that left millions of Americans out of work and out of their homes during the Great Recession, and the scams that banks and other big financial institutions have tried to run on Americans ever since.

Remember back in 2016 when Wells Fargo opened millions of fake accounts in the names of customers, even forging signatures and creating fake PIN numbers to activate accounts? The CFPB demanded they pay back more than $3 billion in redress to consumers and civil penalties. And the big banks and Republicans hated them for doing that. And so did Elon Musk, who wants to destroy the CFPB and happens to also want to turn Twitter into a banking platform, which the CFPB would regulate. So it makes all too much sense to see Trump and Musk and the boys of the Department of Government Efficiency taking aim at an independent government

agency created to stop billionaires from screwing over Americans. Democratic Senator Elizabeth Warren of Massachusetts proposed the CFPB back in 2007 when she was a law professor. And she had some tough words from Musk and Trump on their efforts to shut the bureau down on Monday. Trump campaigned on helping working people, but now that he's in charge, this is the payoff to the rich guys who invested in his campaign

and who want to cheat families and not have anybody around to stop them. But President Donald Trump, being President Donald Trump, decided he should get involved in the conversation from behind the Resolute Desk, no less. That was set up to destroy people. She used that as her little personal agency to go around and destroy people. And she's a fake. Just like she said she was an Indian and she wasn't an Indian. You have more Indian blood in you than she has. Of course. To make sense of what's happening with the Consumer Financial Protection Bureau,

I spoke with Helene Olin. She's the managing editor at the American Economic Liberties Project and a contributing columnist at MSNBC. Helene, welcome to What a Day! Thank you for having me on. So can you start by giving us the backstory to the CFPB? It was created in the wake of the 2008 financial crisis, which I remember all too well. What was the idea behind it? The idea behind the CFPB was to prevent another financial crisis. In 2007, Elizabeth Warren had written a piece for the journal Democracy saying that if you bought a toaster and it had a one in five chance of

blowing up, this toaster would not be on the market, but that this was not true for financial products like mortgages or credit cards, right? That you could find yourself signing something and then the terms could change on you. The price could go up. And so this was her patch for what became the CFPB, was that this would protect people from being taken advantage of by big financial institutions and therefore would prevent such a thing as the mortgage market blow up again. And what does the CFPB do? Who does it regulate? It regulates both the largest banks, not the smaller banks, so like JP Morgan Chase is the CFPB, Bank of America CFPB, and then also they regulate non-banks. So mortgage issuers that are not attached to banks, credit cards, credit reports,

and crucially for our story here, fintech companies. And for the uninitiated, what is fintech? Who are we talking about when we say that? We are talking about technology firms that are effectively acting as banks or credit issuers of some sort. But here's the crucial difference. If you put money in a bank, you get all these legal protections. Until fairly recently when the CFPB under Rohit Chopra moved in on it, you did not get

these protections. So there would be scandals where like a company would say, oh, you know, get your deposit here you'll have high interest rates. And would like sort of intimate that they had FDIC protection, but in fact they did not. So it's been around for a little more than a decade. What have been in your view some of the agency's major successes?

Well, I always say they've returned $21 billion to American, we say American consumers, but we should really say just Americans in financial shenanigans made good. They're probably most famous for helping take on Wells Fargo during the fake account scandal of almost a decade ago now. But they've done auto loans, payday loans, credit cards, kind of you name it. I mean, a lot of these things can feel very small and seem very small, but in fact,

if you are the victim of it, it's actually a very big deal. And as long as the CFPB has been around, Republicans have hated it and they've pushed to get rid of it. Even if some of CFPB's success seems like it would be a good thing for consumers and for, I don't know, the populist right. So why do they hate it so much? Well, first, the big banks and the banking sector and the financial sector

generally hated it. They were more regulated than they used to be be and they didn't like this very much. So they were out for the CFPB from day one. And more recently, they've been joined by the technology slash fintech sector who has come under the increased attention from the CFPB and has also discovered they don't like this very much and that they want the CFPB and has also discovered they don't like this very much and that they want the CFPB to go away. Elon Musk also seems to hate the CFPB but his push to

dismantle it comes as he's also trying to turn Twitter into the everything app that would also include the ability to make payments through the app. Now, despite the fact that I cannot imagine a thing I would less want to have control of my money, that's supposed to roll out soon. What role would the CFPB play in regulating that? Well, they had put forth regulations last year that would essentially begin moving these apps to basically banking status. If you're acting as a bank, you are a bank.

And Elon Musk did not like that very much. He was trying to do what is best, could be best described as a sort of everything app where it would have social media, financial services. And by the way, you know, you could order your pizza, a car, go shopping, fill in the blank, sort of like a version of WeChat that they have in China. And of course, this was, you know,

the CFPB took an interest in this and Elon Musk was not happy about it. The Supreme Court has twice upheld the constitutionality of the CFPB. So this latest effort to shut it down would seem to fly in the face of recent Supreme Court precedent. So where do you see this fight over the CFPB's future headed? Well, it's clearly headed to the courts. What is going on on this go-round is this attempt to shut it down is in a number of ways appears to be contradictory to the statute that set up the CFPB itself.

The CFPB was not set up by presidential fiat. It was set up as part of the Dodd-Frank legislation after Obama was elected. So there are things that the CFPB does, like for example, make sure that military families are not ripped off by the financial services sector, that is actually baked into the statute that this is what they do.

So it would seem that you couldn't just unilaterally say, as the Trump administration has done in the past several days, oh, by the way, see, solve, work. That seems to be a problem. What would it mean for consumers if the CFPB went away, if not entirely, then at least in spirit? It would basically mean there is an open season on you, that you have no major recourse,

at least at the federal level, should you find yourself in the crosshairs of a, you know, a battle with the financial services sector, whether you feel they've stuck a fee on you, whether, you know, the agreement hasn't worked out, or something like that. To be fair, there are states where there is some more regulation in

some of these areas. When states can do it, they sometimes do it, particularly in blue states like California. But regardless, it would not be as easy to simply appeal to the CFPB for help. For instance, right now, there is a database that was still live on the site where people could send in their complaints. I signed up for a credit card and they said there'd be no fee, and lo and there is a database that was still live on the site where people could send in their complaints. I signed up for a credit card and they said there'd be no fee and lo and behold I get charged a hundred dollar fee. This stuff actually matters to people. Again, it could seem sort of simple but it really matters a lot and the CFPB was able to help people in these situations. This is

all happening at a time when money is becoming increasingly virtual, most notably in the form of cryptocurrency. And you mentioned tech companies like Twitter and Meta are trying to insert themselves into the financial space. Without an agency like the CFPB, how could these risky financial markets become even riskier? Well, there would effectively be no protection. If something went wrong, whether your money vanishes in the app, there would be no protection. There would be nobody to appeal to.

If you signed up for one thinking you were getting one set of terms and then there was another. If the interest rates were not what you were promised, there would be nobody to complain to. I mean, this is kind of a huge thing for people, and that this is simply being wiped out is extraordinary. Helene, thank you so much for joining me. Thank you for having me on. That was my conversation with Helene Olin. She's managing editor at the American Economic Liberties Project and a contributing columnist at MSNBC.

We'll link to her work in our show notes. We'll get to more of the news in a moment, but if you like the show, make sure to subscribe, leave a five-star review on Apple podcasts, watch us on YouTube, and share with your friends. More to come after some ads. What a day is brought to you by Rocket Money. It's happened so many times before. You sign up for something, you forget about it after the trial period ends, and then you're charged month after month after month.

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Go to rocketmoney.com slash whataday today. That's rocketmoney.com slash whataday today. That's rocketmoney.com slash whataday. Rocketmoney.com slash whataday. Here's what else we're following today. Headlines. We're going back to plastic straws. These things don't work. President Trump signed another round of executive orders on Monday. One of them returns the use of plastic straws to the federal government. He talked about how much he hates paper straws during a signing ceremony in the Oval Office.

I've had them many times and on occasion they break, they explode. If something's hot they don't last very long, like a matter of minutes. Sometimes a matter of seconds. It's a ridiculous situation. So they explode. The paper straws explode. The order doesn't seem to require anyone to buy plastic straws or ban paper ones outright. It mostly reverses the Biden administration's order for federal government food services to move away from single use plastic products by 2027. Oh, and did I mention the sharks? I don't think that plastic is going to affect a shark very much as they're eating, as they're

munching their way through the ocean. I do not think that Trump knows what a shark is. Also during that Oval Office signing session, President Trump signed orders imposing 25% tariffs on steel and aluminum imports. Trump told reporters while aboard Air Force One Sunday that the tariffs would be on all steel and aluminum imports, including from Canada and Mexico. Domestic metal makers have been lobbying for protection so they can compete against cheap foreign metals.

Trump said it's a big deal while signing the orders in the Oval Office Monday. This is the beginning of making America rich again. He rambled a little while talking specifically about the steel tariffs. All you have to do is make it in the United States. We don't need it from another country. As an example, Canada, if we make it in the United States, we don't need it from another country. As an example, Canada, if we make it in the United States, we don't need it to be made in Canada. We'll have the jobs. That's why Canada should be our 51st state.

The tariffs are expected to hurt some of America's closest allies. What else is new? According to the American Iron and Steel Institute, Canada was the top steel supplier to the U.S. last year, followed by Brazil, Mexico, South Korea, and Vietnam. A federal judge found the Trump administration has not fully complied with his order to unfreeze federal funding. On Monday, U.S. District Court Judge John McConnell ordered the White House to, quote, "...immediately restore frozen funding." He is deciding whether to indefinitely block the freeze through ongoing litigation. The Office of Management and Budget sent out a memo last month

ordering federal agencies to pause funding until the White House could decide if the spending was in line with President Trump's agenda. The memo was later rescinded, but left lawmakers, and the agencies that rely on those grants, very confused. McConnell ordered a temporary restraining order on the plan to freeze federal funding at the end of January, but a coalition of 22 states says the money has still not been restored to several programs. In his judgment Monday, McConnell wrote, quote, the broad categorical and sweeping freeze of federal funds is, as

the court found, likely unconstitutional and has caused and continues to cause irreparable harm to a vast portion of this country. As far as I'm concerned, if all of the hostages aren't returned by Saturday at 12 o'clock, I think it's an appropriate time. I would say cancel it and all bets are off and let hell break out. President Trump said on Monday that the Israel Hamas ceasefire should end if Hamas doesn't return all the remaining Israeli hostages this weekend. Earlier in the day, Hamas officials announced that the armed militant group will not release any more Israeli hostages until further notice. The group accused Israel of violating the ceasefire agreement by launching deadly attacks on the strip in recent weeks.

Hamas was set to release three more Israeli hostages this coming Saturday in exchange for hundreds more Palestinian prisoners. But the group said that the trade would be postponed unless Israel stops targeting Gazans. Israel's defense minister said on Monday that delaying the exchange would violate the ceasefire agreement just three weeks into its first phase. He added that the country's troops in Gaza have been put on high alert. that delaying the exchange would violate the ceasefire agreement just three weeks into its first phase. He added that the country's troops in Gaza have been put on high alert. It comes after Trump doubled down on his plan to kick millions of Palestinians out of Gaza during his interview with Fox. Trump is scheduled to meet with Jordan's King Abdullah II today at the White House.

Topics for discussion will likely include Trump's proposal that Egypt and Jordan take in millions of Palestinians living in Gaza. The president told reporters on Monday that he'd consider withholding aid to the two countries if they don't comply. And that's the news. One more thing. I want to talk about Ye, the artist formerly known as Kanye West. It has made me really sad to see one of the best artists of his generation sell swastika t-shirts and post bafflingly anti-semitic

rants and actual pornography on Twitter. But I think it's important to talk about Ye in the context of celebrity, politics, and how people try to wield celebrities like cudgels and get burned pretty much every single time. Let's go back in time to 2019. Back then, I was working at Vox as a reporter with a focus on conservatism and the American right. And I started noticing something a little odd. Right-wing figures had suddenly decided that they really, really liked Ye. Not his music, his politics,

or what they thought were his politics. Conservative outlets like The Federalist, which never met a hip hop artist they didn't think was responsible for the destruction of Black America, were writing about how Ye getting upset about what his former wife, Kim Kardashian, wore to the Met Gala was good, actually. And when Ye started talking about Christianity and ranting against abortion and Planned Parenthood, even more conservatives got on the bandwagon. The conservative magazine National Review dedicated the cover of its November 2019 issue to an article asking whether or not Ye could be a defender of Christianity, depicting Ye as a saint.

Then Ye decided he was going to run for president in 2020, with the help of Republicans and Jared Kushner, President Trump's son-in-law. He got around 70,000 votes, and the conservative love for Ye continued, even as his behavior began to deteriorate. See, Ye has discussed his bipolar diagnosis back in 2016, and his decision to stop taking medication because he believed it got in the way of his art. More recently, he has discussed receiving an autism diagnosis. And again and again, conservative media ran cover for Ye,

excusing his behavior and his cruelty, like when he made really horrible comments about the singer Lizzo, because he sometimes said things that sounded vaguely conservative. When Tucker Carlson interviewed Ye after praising him for wearing a White Lives Matter shirt back in 2022, Carlson told his audience

that the only people who opposed Ye were enemies of his ideas who wanted to defeat his conservatism. But Carlson's team edited out Ye saying that professional actors had moved into his home to quote, sexualize his children and that he experienced visions from God on quote, how to build these free energy, kinetic,

fully kinetic energy communities. Carlson wanted Ye to be the perfect black conservative celebrity, and was happy to edit him to make him sound that way. You probably know how this ended. Ye went on a weeks-long anti-Semitic rant online and off in October 2022, got booted off Twitter and Instagram, and started hanging out with virulent white nationalists. He even managed to be the first person I've ever seen be too conspiratorial and too anti-Semitic

for conspiracy monger Alex Jones, telling him, quote, "'The Jewish media has made us feel like the Nazis and Hitler have never offered anything of value to the world. I see good things about Hitler also.'" The same conservative outlets that praised him endlessly suddenly had way less to say about Ye's anti-Semitism and misogyny, or about Ye, period. Conservative media has long wanted a black celebrity to repeat its talking points about

gender and race, and they thought they finally had one. Over and over again, they praised his bravery and taking on the left, and then, when it became clear that he is, as he has long been, deeply unwell, they abandoned him. There's a lesson here for all of us. Celebrities are people. They are not ideologies or perfect vectors for all of our hopes and dreams. And if you're depending on a celebrity to make your political dreams come true, well, you're going to be disappointed. Before we go, in case you didn't know, Crooked Media has a ton of exclusive content on our YouTube channels, including Roads Maps, a foreign policy 101 series hosted by Pod Save

the World's Ben Rhodes and produced by Alona Mikovsky. In the latest episode, they look at Trump's plans for mass deportations and changes to the US military, and how history warns us about moves like these. Just search Pod Save the World on YouTube, check out RoadzMaps, and hit subscribe so you don't miss out. That's all for today. If you liked the show, make sure you subscribe, leave a review, check on the Philadelphia Eagles fans in your life and make sure they're okay and safe and everything, and tell your friends to listen. And if you're into reading and not just about how now we face the long, horrifying months without

football with only basketball to save us from having to talk to people or something like me, what a day is also a nightly newsletter. Check it out and subscribe at Cricket.com slash subscribe. I'm Jane Coaston and don't talk to me about baseball. Baseball is not a real sport. What A Day is a production of Cricket Media. It's recorded and mixed by Desmond Taylor. Our associate producers are Raven Yamamoto and Emily Four. Our producer is Michelle Alloy.

We had production help today from Johanna Case, Joseph Dutra, Greg Walters, and Julia Clare. Our senior producer is Erica Morrison, and our executive producer is Adrian Hill. Our theme music is by Colin Giliard and Kashaka. Our production staff is proudly unionized with the Writers Guild of America East.