The Senate voted Wednesday to kill the rule allowing consumers to sue financial institutions. The vote included both republicans and democrats... It’s tempting to say that any bill backed by Wall Street banks must be a bad thing. And in many cases, that’s true. But things are often more complex than they appear to be... Unwinding 8 years of Obama's liberal policies Sometimes the good in a law or agency is vastly outweighed by the bad. And the Consumer Financial Protection Bureau (CFPB), a creature of the Obama administration, allows consumers to sue financial institutions. That part of the CFPB regulation was the good part of it. Consumers should be able to file class action suits against big financial institutions. The Senate vote allows financial institutions to put arbitration clauses into the fine print in applications for accounts, loans and credit cards. That means most people don’t know they’ve signed away their right to sue their bank or lending company. But even class action suits are not always the best option “ often times they’re not. In fact, a CFPB study shows that consumers got more money via arbitration than class action suits. But that’s not all. US Chamber of Commerce President and CEO Thomas Donohue agrees, stating that, “arbitration results in better and quicker outcomes for consumers." And White House press secretary Sarah Sanders pointed out that, "The rule would harm our community banks and credit unions by opening the door to frivolous lawsuits by special interest trial lawyers." Meanwhile, Sen. Mike Crapo, R-Idaho, chairman of the Banking, Housing and Urban Affairs Committee, said: "The effort to try to characterize this as some devious system that has been created to try to stop consumers from having access to fairness is simply false. We have a very fair system that has been working for over 100 years in this country."Â Crapo also noted that the average outcome for consumers in class-action lawsuits against financial companies was just $32, while lawyers made millions. But the bigger political play is the CFPB itself. The CFPB - The Fed’s small business hitman The CFPB was part of the Dodd-Frank financial reform passed after the Global Financial Crisis of 2009 and a major achievement of the Obama administration. It was given exceptionally broad authority over US financial institutions, from major banks to community credit unions to payday loan companies to mortgage and real estate firms. Pay day loan firms, for example, have been targeted by the CFPB because they charge high interest for short term loans to customers who may not have any other option. Think about that. Private firms loan people money when others won’t. They perform a service and fulfill a need that help millions of ordinary people. But the CFPB wants to shut them down. Apparently because they "take advantage" of poor people. That’s the way the CFPB sees it. But without those companies, where would those people be? What other firms are willing to take the risk of lending money to the poor? Certainly not big banks. or even small ones. And the CRPB would replace these payday lending services with what? The CFPB can certainly destroy; but it can’t create. CFPB answers to no one But this rogue agency is different than other regulatory agencies. It doesn’t answer to Congress or the president. The CFPB is entirely funded by none other than the Federal Reserve. What’s more, this single, appointed CFPB director who answers to no one in the government has a 10-year term and cannot be removed. That’s un-American and unconstitutional. Other agencies are usually run by a bipartisan committee of three-to-five people. With Congressional or presidential oversight and funding. As Judge Brett Kavanaugh wrote in a unanimous court decision a three-judge panel from the D.C. Circuit, "The (CFPB ) Director enjoys significantly more unilateral power than any single member of any other independent agency." These are the key reasons why the Senate voted to end the arbitration rule. This vote is about much more than the arbitration rule This vote is really the beginning of a campaign by the republican Congress and president Trump to defang this powerful, ultra-progressive, unaccountable and unconstitutional office... The CFPB's unrivaled power and protection that is totally against America’s representative system. And very similar to the Fed. This Congress is determined to make the CFPB report the American people. And get rid of the 10-year power rule of one person. Is it any wonder that the Fed would fund and support such a dictatorial bureau? Or that Barack Obama and Hillary Clinton were in favor of it? ”Fighting” the big banks The counter argument is that the CFPB is needed to fight the big banks, like Wells Fargo. Consumers definitely need help against these predatory banks that run roughshod over the economy and customers. But do you think that an agency like the CFPB, that’s funded by the Fed, the mother of all Wall Street banks. Would really fight for consumer rights against those same banks? Supporters point to the Wells Fargo scandal as proof of the need for the CFPB. But, according to Congressional testimony, the CFPB interviewed only THREE Wells Fargo employees in their investigation of millions of crimes that went on for years. And impacted millions of consumers. The CFPB is either very, very good at what they do. Or are protecting their own. What do you think? Trump’s endgame: to break up the big banks? During the presidential campaign, Donald Trump said he would cut regulations and look at breaking up the big banks. One way to do that would be to bring back the Glass-Steagall Act. Which was repealed by Bill Clinton in 1999. The would once more protect depositors by separating commercial banks from investment banks. Trump knows that Glass-Steagall served a very key purpose in stabilizing the banking industry and protecting depositors. It wouldn’t solve every problem, of course. And to be clear, we should all have legal recourse against financial institutions. But we certainly don’t need an agency with the power to destroy businesses that’s unaccountable to the Congress or the president. Expect the Fed to fight it all the way.