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https://www.cbsnews.com/news/supreme-court-cfpb-funding/
The Supreme Court on Thursday upheld the funding structure for the Consumer Financial Protection Bureau, or CFPB, rescuing the consumer finance agency from another effort by its critics to weaken it.
The court said in a 7-2 decision that the agency's funding structure complies with the Constitution's Appropriations Clause. Justice Clarence Thomas authored the majority opinion. Justices Samuel Alito and Neil Gorsuch dissented.
"Under the Appropriations Clause, an appropriation is simply a law that authorizes expenditures from a specified source of public money for designated purposes," Thomas wrote. "The statute that provides the bureau's funding meets these requirements. We therefore conclude that the bureau's funding mechanism does not violate the Appropriations Clause."
The decision reverses a ruling from the U.S. Court of Appeals for the 5th Circuit that concluded the mechanism for funding the consumer agency was unconstitutional.
Thomas wrote that the statute laying out how the CFPB gets its funding — from the Federal Reserve — fits with the appropriations practices dating back to the First Congress and is similar to schemes used to fund the Post Office and Customs Service, which were established in the late 1700s.
In a dissenting opinion, Alito said the ruling in favor of the CFPB "turns the Appropriations Clause into a minor vestige." He said that under the funding scheme upheld by the court, the consumer watchdog can "bankroll its own agenda without any congressional control or oversight."
"There is apparently nothing wrong with a law that empowers the executive to draw as much money as it wants from any identified source for any permissible purpose until the end of time," Alito wrote. "That is not what the Appropriations Clause was understood to mean when it was adopted."
The Framers, he said, "would be shocked, even horrified," by the way the CFPB receives its funding.
The Supreme Court on Thursday upheld the funding structure for the Consumer Financial Protection Bureau, or CFPB, rescuing the consumer finance agency from another effort by its critics to weaken it.
The court said in a 7-2 decision that the agency's funding structure complies with the Constitution's Appropriations Clause. Justice Clarence Thomas authored the majority opinion. Justices Samuel Alito and Neil Gorsuch dissented.
"Under the Appropriations Clause, an appropriation is simply a law that authorizes expenditures from a specified source of public money for designated purposes," Thomas wrote. "The statute that provides the bureau's funding meets these requirements. We therefore conclude that the bureau's funding mechanism does not violate the Appropriations Clause."
The decision reverses a ruling from the U.S. Court of Appeals for the 5th Circuit that concluded the mechanism for funding the consumer agency was unconstitutional.
Thomas wrote that the statute laying out how the CFPB gets its funding — from the Federal Reserve — fits with the appropriations practices dating back to the First Congress and is similar to schemes used to fund the Post Office and Customs Service, which were established in the late 1700s.
In a dissenting opinion, Alito said the ruling in favor of the CFPB "turns the Appropriations Clause into a minor vestige." He said that under the funding scheme upheld by the court, the consumer watchdog can "bankroll its own agenda without any congressional control or oversight."
"There is apparently nothing wrong with a law that empowers the executive to draw as much money as it wants from any identified source for any permissible purpose until the end of time," Alito wrote. "That is not what the Appropriations Clause was understood to mean when it was adopted."
The Framers, he said, "would be shocked, even horrified," by the way the CFPB receives its funding.
