As morning broke Wednesday following the most surprising presidential race since Dewey did not defeat Truman, Consumer Financial Protection Bureau (CFPB) Director Richard Cordray was faced with the real possibility that his tenure as head of the CFPB could be over after the Jan. 20 inauguration.
So many possibilities that were considered nearly impossible two weeks ago suddenly came to the forefront after 2:30 a.m. Wednesday morning, when news agencies called Wisconsin for Donald Trump – after previously calling Pennsylvania for him – to secure an improbable Republican sweep of the White House, Senate and House.
Following the D.C. Circuit Court of Appeals ruling against the CFPB in the PHH v. CFPB case, which made Cordray removable from his position at the will of the president, there is now the real possibility that president-elect Trump could relieve Cordray of his position and either appoint a new director – who would face far less opposition in a Republican-controlled Congress – or merely leave the position open and shut down operations for an indetermined period.
“I want to tell the world that while we will put America’s interest first, we will deal fairly,” with all parties, Trump said in his victory speech in New York. “We’re going to fix our inner cities … and rebuild our infrastructure … and put millions of people to work as we rebuild it.
“Every American will have the opportunity to reach his/her full potential.”
In her concession speech Wednesday morning, Hillary Clinton said she offered her best to president-elect Trump.
“I hope that he will be a successful president for all Americans. This is not the outcome we wanted or we worked so hard for, and I’m sorry we did not win this election for the values we share and the vision we hold for our country,” she said.
The unexpected sweep puts Republicans in control of the White House, Senate and House of Representatives for the first time since George W. Bush took office.
“Tonight, voters made one thing clear: They want Republicans to take the country in a bold new direction,” Republican National Committee Chairman Reince Priebus said in a press release. “Donald Trump’s candidacy inspired millions of Americans to join his quest to give a voice to those who have long felt silenced. We are ready to introduce a Republican agenda of economic opportunity, strong national security, and individual freedom that will benefit all Americans.
“With a Republican Congress firmly in place and Donald Trump in the White House, we can get to work on fixing Washington and bringing prosperity back to the American people.”
The election results are expected to have a profound effect on not just the CFPB, but all manner of financial regulation. There are two open positions on the Federal Trade Commission, two open spots on the Commodity Futures Trading Commission, two open spots on the Securities and Exchange Commission, and two unfilled positions on the Federal Reserve. One of the reasons for that has been the difficulty in getting the Senate to approve presidential appointees. That figures to get a little easier with both as Republicans.
Former Minnesota Gov. Tim Pawlenty, now CEO of the Financial Services Roundtable, said the Republican victories bring opportunity.
"Our country faces big challenges, but it also has incredible opportunities for innovation and growth that will provide a brighter future for people who need hope and help," he said in a prepared statement. "The new administration and Congress should enact policies that grow the economy, spur innovation, protect both consumers and taxpayers, add good-paying jobs, and help more Americans reach their financial goals."
Meanwhile, Mortgage Bankers Association (MBA) President and CEO David Stevens congratulated the new president as well.
"MBA will work with president-elect Trump and his administration, as well as the new Congress, with the goal of advancing an agenda that restores housing as a lead economic driver for individual wealth creation and the nation as a whole" Stevens said in a statement. "We are looking forward to engaging with policymakers, new and old, to guarantee sustainable access to credit for qualified consumers, and restore balance and prosperity to the real estate markets."
“We call on the administration and Congress to come together and work for the common good," American Bankers Association President and CEO Rob Nichols said in a statement. "We look forward to working with members of both parties on policy solutions that will allow banks to help accelerate economic growth, create jobs, better serve their local communities and help their customers and clients succeed.”
The Senate Banking Committee has been chaired by Sen. Richard Shelby (R-Ala.), who was elected to a sixth term Tuesday night, but that is expected to be turned over to Sen. Mike Crapo (R-Idaho), who the National Association of Federal Credit Unions said has a history of supporting regulatory relief, “a key pursuit of NAFCU’s in its efforts to ensure a positive regulatory environment for the nation’s member-owned credit unions.”
The House Financial Services Committee will remain in the hands of Rep. Jeb Hensarling (R-Texas), and among Hensarling’s first moves next year is expected to be introducing his Financial Choice Act, which overhauls and eliminates aspects of the Dodd-Frank Act, reins in much of the authority of the CFPB, and creates a five-member commission to lead the agency.
“With a new president-elect and changes to the House and Senate, government and industry leaders have a chance to find workable solutions on issues most important to consumers,” Consumer Bankers Association President and CEO Richard Hunt said in a statement. “This is especially true for banking issues, as a strong banking sector is critical to a strong economy. CBA congratulates president-elect Donald Trump and will remain focused on working with members of congressional committees and federal agencies key to the financial services industry on our priorities, including a five-person, bipartisan commission at the Consumer Financial Protection Bureau; common sense policies to help banks innovate in the 21st century; and improving the regulatory environment so banks may continue to meet consumer needs.”
There will be some opposition in place. Although Republicans hold a slim majority in the Senate – 51-47 with New Hampshire and Louisiana races still yet to be called – it is not filibuster-proof, and the only leverage that Democrats will have in Congress will be to filibuster nominees or bills.
That could provide some obstacle to Republicans racing to introduce changes and repeals to policies enacted the past eight years, but it also could introduce the idea of Republicans choosing to eliminate the filibuster. In 2013, Senate Majority Leader Harry Reid (D-Nev.) did just that, using what was called the nuclear option to free up a host of judicial nominations that had been filibustered by Republicans.
More reaction is expected to come as day breaks, along with an official concession speech from Democrat Hillary Clinton, who called Trump to concede and offer her congratulations late Tuesday night but did not speak publicly herself.