Mulvaney aims to cement CFPB legacy by ensuring successor's confirmation

Mulvaney aims to cement CFPB legacy by ensuring successor's confirmation
© Greg Nash

Consumer Financial Protection Bureau (CFPB) acting Director Mick MulvaneyJohn (Mick) Michael MulvaneyOn The Money: Trump rips Fed over rate hikes | Dems fume as consumer agency pick refuses to discuss border policy | Senate panel clears Trump IRS nominee Trump pick to head watchdog agency is who consumers need Dems fume as Trump's consumer bureau pick refuses to discuss role in border policy MORE is going to bat for his potential successor, and in doing so he's poised to extend his influence at the watchdog agency.

Mulvaney, who doubles as head of the White House Office of Management and Budget (OMB), has emerged as a key proponent of Kathy Kraninger, President TrumpDonald John TrumpTrump warns Iran's Rouhani: Threaten us 'and you will suffer' Pompeo: Iran's leaders resemble the mafia NYT's Haberman: Trump 'often tells the truth' MORE’s pick to be the CFPB’s full-time director, despite his previous reluctance to influence the selection process.

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Trump’s decision to nominate Kraninger, an associate director at the OMB, surprised lawmakers and industry advocates who were expecting the president to go with a bigger-name nominee.

As a result, Mulvaney has sought to quell concerns about Kraninger’s credentials to lead the 7-year-old agency. He’s called key Republican senators this week to tout Kraninger’s experience, and he issued a glowing statement in support of her Senate confirmation.

Congressional Republicans have praised Mulvaney's efforts to rein in the CFPB’s regulatory actions and are expected to support Kraninger, who they see as building on Mulvaney’s legacy. That, in turn, has raised concerns among Democratic lawmakers and other White House critics who say her nomination is an attempt to extend Mulvaney’s influence over the CFPB.

Liberals are broadly opposed to Kraninger’s nomination, but the question of how much she’d follow in Mulvaney’s footsteps is the primary concern among moderate Democrats who’ve crossed party lines to support other Trump nominees.

“I don't think Mulvaney can do both jobs, so hopefully this person isn't just a figurehead,” Sen. Jon TesterJonathan (Jon) TesterTrump Jr. to hold fundraiser for Manchin challenger History argues for Democratic Senate gains Overnight Defense: Trump inviting Putin to DC | Senate to vote Monday on VA pick | Graham open to US-Russia military coordination in Syria MORE (D-Mont.) told The Hill on Tuesday. "If it’s just a figurehead, I've got some major concerns.”

If confirmed, Kraninger would wield substantial power and independence to police the financial services industry over a five-year term. The bureau’s funding mechanism is separate from the annual appropriations process that applies to most federal agencies, giving the director unique control over the agency’s budget.

It’s still unclear whether the president can legally fire the bureau’s chief without cause, meaning Kraninger could lead the CFPB well into the next president’s tenure, even if there are significant policy disagreements between the two.

Mulvaney has drawn scorn from Democrats for easing the CFPB’s oversight of the financial services industry, particularly the delaying of rules issued by former Director Richard CordrayRichard Adams CordrayTrump pick to head watchdog agency is who consumers need Liberals view Kavanaugh as existential threat to consumer bureau Mulvaney appoints top aide as consumer bureau acting No. 2 MORE and his efforts to reduce the independent agency's budget and staff.

Kraninger has more than a decade of experience with budgets for federal agencies, including those within the Treasury, Homeland Security, Housing and Urban Development and Homeland Security departments. Her role at OMB covers seven Cabinet departments and 30 agencies, including all federal financial regulators, according to the White House.

She’s been endorsed by Senate Majority Leader Mitch McConnellAddison (Mitch) Mitchell McConnellPelosi: 'Thug' Putin not welcome in Congress GOP to White House: End summit mystery Sunk judicial pick spills over into Supreme Court fight MORE (R-Ky.) and House Financial Services Committee Chairman Jeb HensarlingThomas (Jeb) Jeb HensarlingOn The Money: Fed chief lays out risks of trade war | Senate floats new Russia sanctions amid Trump backlash | House passes bill to boost business investment House passes bipartisan bill to boost business investment On The Money: US files complaints at WTO | House leaders get deal to boost biz investment | Mnuchin says US will consider Iran sanctions waivers | FCC deals blow to Sinclair-Tribune merger MORE (R-Texas), who both say she’s well equipped to reform what they consider an unruly and unaccountable regulator.

But Kraninger, a former Senate Appropriations Committee staffer and Department of Homeland Security official, has little hands-on experience with crafting or enforcing financial rules. Her views on the CFPB’s operations and policies are also largely unknown, spurring questions about her qualifications for the job.

"I don't know much about her, but I'm concerned if she was Mick Mulvaney's choice,” said Sen. Mark WarnerMark Robert WarnerPutin summit puts spotlight back on Trump's tax returns Senate panel advances Trump IRS nominee Bipartisan bill would bring needed funds to deteriorating National Park Service infrastructure MORE (D-Va.), a supporter of the Dodd-Frank rollback legislation that Trump signed into law last month.

Mulvaney has been one of Kraninger’s biggest advocates, playing an unexpectedly prominent role in selling Republican senators on her nomination.

The acting chief has said for months that he doesn’t want to cast a shadow over the confirmation process of his successor.

“I’ve tried really hard to stay out of the discussion for whoever the White House nominates,” Mulvaney said at a banking industry conference in April. He added that his influence “runs the risk of the hearing being as much about me as about” the nominee.

Mulvaney also told reporters as recently as last week that he had avoided internal conversations about who Trump would pick.

But Mulvaney has shifted gears since Kraninger’s nomination, which was made official Monday. The following day he called her “the ultimate public servant” and praised her “vigorous independence, sharp-as-a-tack intelligence, and simple, old-fashioned, Midwestern humility.”

“I know that my efforts to rein in the bureaucracy at the Bureau of Consumer Financial Protection to make it more accountable, effective, and efficient will be continued under her able stewardship,” Mulvaney said.

Several GOP members of the Senate Banking Committee, which is expected to hold a confirmation hearing for Kraninger later this year, said Mulvaney has reached out to them to discuss Kraninger’s nomination.

Sen. Mike RoundsMarion (Mike) Michael RoundsKey GOP senator says ‘no question’ Russia is meddling in U.S. affairs GOP Senator: 'Very inappropriate' for Trump to discuss allowing Russia to question US citizens Election security bill picks up new support in Senate MORE (R-S.D.) said Mulvaney spoke “very highly” of his potential successor.

Fellow GOP Sens. Jerry MoranGerald (Jerry) MoranGOP to White House: End summit mystery GOP Senator: 'Very inappropriate' for Trump to discuss allowing Russia to question US citizens Lobbying world MORE (Kan.), David Perdue (Ga.) and John KennedyJohn Neely KennedyMORE (La.) — all members of the Banking Committee — told The Hill that Mulvaney called them to talk about Kraninger’s nomination.

"Mulvaney is very high on the nomination, and that carries a lot weight with me,” Kennedy said.

Under federal law, Mulvaney is allowed to remain as acting head of the CFPB for as long as it takes to confirm his successor, giving him more time to transform the agency.

Kraninger will likely face a lengthy confirmation process as Congress rushes to finish a slew of must-pass bills before the November midterm elections. Sen. Elizabeth WarrenElizabeth Ann WarrenOn The Money: Trump 'ready' for tariffs on all 0B in Chinese goods | Trump digs in on Fed criticism | Lawmakers drop plans to challenge Trump ZTE deal On The Money: Trump rips Fed over rate hikes | Dems fume as consumer agency pick refuses to discuss border policy | Senate panel clears Trump IRS nominee Dems fume as Trump's consumer bureau pick refuses to discuss role in border policy MORE (D-Mass.), who’s considered the CFPB’s architect, said she would place a hold on Kraninger’s nomination, further slowing down the process.

Senate Republicans have a slim majority and cannot afford a single defection to confirm Kraninger while Sen. John McCainJohn Sidney McCainThe Memo: Summit fallout hits White House Graham: Biggest problem is Trump ‘believes meddling equals collusion’ Obama, Bush veterans dismiss Trump-Putin interpreter subpoena MORE (R-Ariz.) receives treatment for a brain tumor at home in Arizona, assuming both sides dig in on their opposition or support.

But Kraninger could earn the backing of some moderate Democrats who are facing reelection this year in states that Trump won in 2016.

Sens. Heidi HeitkampMary (Heidi) Kathryn HeitkampHistory argues for Democratic Senate gains Polling analyst: Same Dems who voted for Gorsuch will vote for Kavanaugh Dems pressure GOP to take legal action supporting pre-existing conditions MORE (N.D.) and Joe DonnellyJoseph (Joe) Simon DonnellyHistory argues for Democratic Senate gains Polling analyst: Same Dems who voted for Gorsuch will vote for Kavanaugh Pollster: Kavanaugh will get Dem votes MORE (Ind.) — two of the most vulnerable Senate Democrats — told The Hill on Tuesday that they had just started to review Kraninger’s nomination and had not come to a decision yet.