February 12, 2025 - 4:30pm
Donald Trump’s administration has wasted no time signalling its economic priorities. Just weeks into his second term, the White House issued a remarkable statement on the Consumer Financial Protection Bureau (CFPB) that, at least on the surface, appears to mark a decisive shift away from the economic populism that helped fuel Trump’s return to power.
The CFPB, born from the ashes of the 2008 financial crisis, was designed to be America’s first comprehensive financial watchdog. Now it faces an uncertain future under Trump, with his administration branding the agency a “woke, weaponised arm of the bureaucracy” that “leverages its power against certain industries and individuals disfavoured by so-called ‘elites’.” Despite framing the CFPB in language that will appeal to the MAGA base, this rhetoric masks a straightforward assault on basic consumer protections. For one thing, Trump’s team has targeted the Bureau’s recent decision to ban medical debt from credit reports — a move that would have helped an estimated 15 million Americans by preventing debt collectors from using unpaid hospital bills to wreck their credit scores.
Many of these bills stem from insurance disputes or hospital billing errors rather than financial irresponsibility. Yet Trump’s statement, drawing directly from banking industry complaints and interviews from figures at Right-leaning think tanks such as the Heritage Foundation, characterises this protection as “government overreach” and claims the agency “unilaterally buried $50 billion in medical debt”. Similar logic drives the administration’s opposition to CFPB limits on overdraft fees, which disproportionately impact working-class Americans — precisely the demographic Trump won over during the general election with promises to fight the establishment.
This shift has caught some of Trump’s erstwhile allies off guard. Independent journalist Glenn Greenwald, who has often found himself aligned with the President’s foreign policy positions, expressed surprise at moves to gut the CFPB, noting that it represents “the opposite of the economic populism claimed by MAGA”. In a recent conversation with Greenwald, anti-monopolist writer Matt Stoller placed the CFPB within a broader post-2008 phenomenon that united both Left and Right. “There was a perception across the spectrum,” he said, “that we had gotten to a point where massive financial institutions and corporations had centralised so much power in Washington that ordinary Americans just had no voice any longer.”
So is Trump betraying the economic populists? As ever, it is hard to draw out a clear theme from the President’s first three weeks in office. Alongside his assault on the CFPB, Trump has rolled out proposals aimed at working-class voters, including the elimination of federal taxes on tips, social security payments, and overtime pay — a move that would directly benefit millions of service workers but bleed revenue, unless DOGE cost-cutting measures can offset this. His administration is also pursuing a fairly aggressive stance toward Big Tech through the Federal Trade Commission, with new chair Andrew Ferguson hiring some outspoken industry critics. But as Stoller has warned, the MAGA movement still risks “falling into the trap that Democrats fell into under Obama” by getting “fooled by the Wall Street and Big Tech parts of their coalition into supporting things that are bad for Americans”.
The strategy mirrors Trump’s first-term playbook, when his signature tax cuts benefitted corporations and the wealthy but also delivered enough economic growth — including record-low unemployment and a soaring stock market before Covid hit — to keep his base satisfied. Now he’s betting on repeating the formula. Nevertheless, MAGA diehards such as Steve Bannon have warned about this tendency, viewing Trump’s courting of Elon Musk and his selection of Wall Street veteran Scott Bessent as Treasury Secretary as betrayals of the movement’s populist origins. But Trump, like Ronald Reagan and other Republican presidents before him, appears to be calculating that these decisions can drive enough gains to his base to maintain their loyalty. Now that the President’s campaigning days are over, he will be more unpredictable than ever — even if it comes at the cost of some abandoned campaign promises.
Oliver Bateman is a historian and journalist based in Pittsburgh. He blogs, vlogs, and podcasts at his Substack, Oliver Bateman Does the Work
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SubscribeIt’s not an assault on consumer protections. If the CFPB is anything like our financial regulators, the FOS and FCA, it is simply more bureacracy that generates costs for financial service providers – costs that are, of course, paid for by consumers – without actually providing any real protection. London Capital and Finance anyone?
Independent investigation into the FCA’s supervision of London Capital & Finance – GOV.UK
The only effective consumer protection is caveat emptor.
You could make an argument that Trump is just following his promise of draining the swamp. Hidden government expenditure and hidden debt are part of the swamp – favouring those who have jobs ‘managing’ the visibility of such items.
Nonsense. This type of board is a wealth redistribution scheme initially proposed by Harvard’s “First Native American Law Professor” Elizabeth Warren.
It’s role is to essentially to hand out financial reparations and grant debt waivers with very little accountability or discernment. It is Socialism plain and simple.
Furthermore, Trump’s 2017 tax cuts immediately increased the disposable income of of every working person I know. It did not increase the disposable income of people not working.
Populism and Socialism are not synonymous concepts. Its becoming clear how the Kulaks felt during the collectivization scheme in the Soviet Union.
I’m not sure that we should assume any government agency automatically does what it is supposed to do or what it was intended to do without proof that’s what it was actually doing. I have seen many criticisms of how Trump shut down this agency but I have yet to see any of these critics offer anything the organization has tangibly done for any American particularly. If people have been helped by the CFPB, surely somebody ought to be able to find some of them to testify to that effect. Otherwise this just looks like some other government bureaucracy doing God only knows what behind the scenes and without any serious oversight and getting paid by the taxpayers to do it.
After seeing the results of Obama’s health care law, I’m skeptical that anything created by his administration was created without direct input from the organizations it was meant to regulate. That was the MO his health care law established. Put regulations in place that protects the profits of these companies and locks them in at an ‘acceptable’ level in exchange for giving them cover from the vagaries of competitive markets and deflecting the wrath of angry voters. The ACA was basically written by and for insurance companies, ensuring their perpetual existence and perpetual profits indefinitely. It didn’t work though. It has only recently become apparent how much it didn’t work when people cheered for a man who murdered an insurance executive. If these CFPB defenders can produce even one person the agency has helped, maybe I’ll care whether it gets shut down. Until then, I’m defaulting to it’s useless bureaucracy that wastes taxpayer money.
Why do Republicans always oversimplify the ACA? Just because the Affordable Care Act (ACA) relies heavily on private insurance companies doesn’t mean it was written by them. It was modeled after a conservative-backed plan, including Romneycare in Massachusetts, and aimed to expand coverage while maintaining a private insurance system.
Both sides benefitted.
Insurance companies:
The individual mandate forced more (mostly healthy) people into the market, balancing out high-cost enrollees.Government subsidies made plans more affordable, ensuring insurers got paid.Medicaid expansion brought millions of new customers to insurers managing Medicaid plans.Consumers:
Preexisting condition protections meant insurers couldn’t cherry-pick only healthy customers.Medical loss ratio rules required insurers to spend at least 80-85% of premiums on actual care, limiting profit margins.Essential health benefits mandated coverage of services insurers previously avoided.
While insurers adapted and profited, they also lobbied against certain ACA provisions, like the public option. The ACA was a compromise between universal coverage advocates and maintaining a private insurance framework.
Second, I always know when healthy people are weighing in on policies. You won’t have to go far to find stories of the CFPB saving people. My insurance dropped a chemo drug I needed to survive and left me with a 22k bill. Without the CFPB, I wouldn’t have got that money back. I am not sure what rock you are living under, but guess what is the number one reason people declare bankruptcy – medical debt.
Now, the new medical debt rule that would have kept medical debt from hurting people’s credit reports is gone. And we all know that’s why Republicans want it gone – because they don’t care about the sick. Too bad you will be there one day too, and karma is a real b***h.
Thank you for responding. This is just the sort of thing I was looking for actually. I asked for an example of someone the CFPB helped and here you are. This I respect. The people criticizing Trump should be trumpeting your story from the rooftops and sounding the alarm that he isn’t the man of the people he claims to be. That’s surely a sign of the times, that I am believing a random stranger on the Internet before the politicians, government, and most of the media. I never have believed Trump is a true populist or really wants to advocate for the people. I do maintain he is a disruptive influence and accomplishes the purpose of destabilizing the political establishment and their corporate backers so maybe it will create an opening for a real populist to come along and finish the job. He’s better than another corporate shill like Kamala Harris, not that I voted for either of them mind you. Neither meets the required standards for using up 15-20 minutes of my day.
You can’t convince me the ACA wasn’t a sellout though, because I believe that the insurance companies should not exist period. They neither provide healthcare, nor do they consume it. They are parasites, plain and simple. It is classic rent seeking for revenue streams to fund financial speculation, pure greed that has nothing to do with health care. That is why they exist, to fund Wall Street speculation. That’s all insurance companies by the way, not just medical insurance. Ever wonder why there are laws that require people to buy car insurance? It actually is a racket. Insurance companies are little more than rent collection agencies for Wall Street trading funds. Whatever the solution is, they should get no part of it. That’s what I won’t forgive Obama for. He is smart enough to know all this, and he should have had the courage to bring it all out into the light and take his case directly to the people. For all that he gets wrong, Trump at least has the courage to go directly to the people. For that alone, people will overlook quite a lot. Obama should have been the one to do that. He was elected on a platform of hope and change. He failed to deliver. I voted for the man, and I have not voted since, not for Trump or anyone else. Obama allowed the corrupt system of insurance companies and employer provided healthcare to continue to exist in exchange for them making it marginally less awful and unfair. He sold out, plain and simple. We, the people, have the right to demand better than this. If I ever see it, I might vote again. Had Sanders won the primary in 2016 or 2020, I might have voted for him. I would support single payer healthcare or Medicare for all. While I don’t believe it would improve the healthcare system as a whole based on the evidence we have from similar systems in places like the UK, it would finally and forever cut the insurance parasites out of the process.
Further, you’re wrong. I actually was one of the people who couldn’t get insurance because of a pre-existing condition. Believe it or not, it is possible for a person to believe and reason that the optimal solution for society is not simply the one that advances his or her personal fortunes or interests. I would prefer a competitive marketplace where doctors and hospitals charge fees and patients can compare prices and choose the best option, and then those who can’t afford healthcare below a certain income level get vouchers, something similar to education vouchers. This would encourage and encourage providers to compete on the basis of quality and price for customer dollars, and the entire industry would be more efficient, lean, and responsive. The current system is frankly the worst of both worlds. We have all the bureaucracy, red tape, delays and problems of a national health care system, and we still have people going bankrupt. Further, if I ever get cancer, I will most likely choose not to treat it at all, as I don’t have the financial resources to pay and I refuse to burden my family with medical debt. I think I’d rather make the best of the time I have rather than try to extend my life and be bled dry by a parasitic system that preys on the sick and the poor for the sake of funding Wall Street’s endless quest to get rich without actually producing anything or doing anything productive.
Parasites. Not true. Profits are tiny compared with other businesses. Their existence allows the government to play fairy godmother by leaving the judgements about cost and necessity to them, unlike Canada and the UK where the state run systems do the tough parts. If you think a state run system will be better, look into Canada and the UK for waiting times. Close to home, check out the Veteran’s Administration, the Indian Health Service, or the estimated billions in fraud in Medicare and Medicaid. Be careful about what you wish for.
The definition of a parasite is an organism that derives sustenance from the activities of another organism, called the host. In order to be a parasite, the organism must take resources and nourishment from the host and thus cause harm without providing any meaningful benefit. They fit the definition, as they do not provide health care nor any other service related to health care to patients, yet their profit comes entirely out of a series of transactions that could and would exist without them. According to the definition, insurance companies are parasitic to the healthcare system because A.) they do not provide health care nor improve it any identifiable way and B.) depend upon the healthcare industry for their own sustenance, and C.) cause harm by distorting free market competition in a way that’s essentially no different than governments setting prices. I don’t see how that can be any clearer. How much money they make relative to other industries is irrelevant. Whether they make ten million dollars or ten, that’s money that should go to the people who actually provide the service or the people who pay for it. I could live for years with a tapeworm and still be mostly fine but I’d still want it gone if I found out I had one. I honestly don’t think much would change if we went to single payer healthcare. I think it would be mostly the same as it is now since Medicare, Medicaid, and the insurance conglomerates already effectively set the prices. For all intents and purposes, we already have a national healthcare system. It will still be better than the UK/Canada because the government isn’t running the hospitals. What would be better than either would be to eliminate employer healthcare coverage and medical insurance and let the marketplace function through the mechanism of competition between healthcare providers on quality and cost and allow the government to provide vouchers for the poorest to get access to healthcare that providers can then redeem from the government without all the overhead, bureaucracy, and financialization.
Obama disappointed alot, but you fall into the trap of assuming he had such a strong position in Congress at the time he could be much more radical than he eventually was. He was also initially consumed with the Financial crash. He basically managed to extend cover to millions more by with some legal coercion to take out insurance. And that way extend the risk pool which made it viable. But the market for insurance was insufficient to stop costs continuing to rocket.
So I agree the US system a disaster. The World’s richest and most developed Nation but with millions still without proper healthcare cover and millions screwed on the smallprint. It’s partly because of vested interests, but it’s also partly because social solidarity much weaker culturally in the US (with maybe some of that a racial legacy too) meaning Galbraith’s ‘private affluence, public squalor’ more true today than when he wrote it.
Well, I was younger and more naive then. Perhaps I overestimated Obama or misjudged him. Whatever the reason, Obama was not the change agent he advertised himself to be, but he could have been if he had really wanted to and had some courage and determination I believe Obama could have gone directly to the people with his message and confronted the institutional powers that be and the people would have had his back. I think he could have been a transformational, visionary leader and done a better job than Trump, but maybe he never was what he advertised himself to be. Maybe he was just another corporate shill pretending to be on the side of the people. Maybe he lacked courage. Maybe he was even threatened. Who knows, but for whatever reason, he didn’t take his case directly to the people and offer to fight the establishment. Trump did, and here we are. A reality television personality has brought the political establishment to its knees. Trump understands real power comes not from money, but from loyalty, devotion, and a shared sense of purpose. For all their money, for all their institutional control, for all their domination of the media and the bureaucracy, the donor class could not buy Kamala Harris the presidency. Their failure is worth something even if the winner does nothing. Trump has shown what can be done. Even now, he uses the popular will to overrule the establishment. Does anyone seriously believe Tulsi Gabbard, Pete Hegseth, or RFK Jr. would have been confirmed if the voting were done secretly? Of course they wouldn’t, but it’s a public vote, as it should be, and the Senators would have had to declare their opposition to the popularly elected President, which very few did, because they feared the wrath of voters, and when politicians fear the voters, they are more apt to listen to the voters and consider public opinion, and that’s something that has been missing in this country for far too long. Where government fears the people, there is liberty. That’s the thing that’s good about the Trump movement. It sent a message. It reminded the oligarchs that this is America, and the people expect the politicians to obey, not the other way round. The real power comes from the people. For all he gets wrong, Trump at least understands that. Even if he fails, and that’s a strong possibility, the message will remain, and the door will be standing wide open for the next revolutionary outsider who can capture the public’s mood.
It doesn’t take many unintended consequences from the collapsing of such Agencies to change the impression. No doubt one couldn’t contend every decision made by such an Agency universally supported, but if you detonate the lot you are rolling the dice.
Whether sufficient Federal cost reductions materialise to quickly get the Reconciliation Bill through the House remains unclear. Trump wants to spend alot more on Immigration controls and collect alot less, including the Billionaire tax cuts. Extending debt to do this anathema to good number of key House Republicans. That’s partly why the announcements on cuts are well out ahead of the actual confirmation of savings. He doesn’t need to have turned off many to lose his House majority.
But you can already discern the 2026 campaign response – ‘he increased your debt, protected his Cronies Billions and reduced your protections’. Trump needs a surge in living standards or it’s a potential gift.
There comes a point when you have to make hard choices. Sometimes a building is in such poor condition that it’s better to just demolish it and start over. Sometimes that means a lot more work and it may mean it takes a lot longer to get the new structure built, but we shouldn’t avoid doing the right thing because it’s more difficult or more time consuming. The bureaucracy as it currently exists has too much independence and not enough accountability to elected officials. It’s been captured by special interests, billionaires, and corporations, and it needs to be reformed. The bureaucrats who have been acting independently of the government have to be purged and replaced with those who have a proper respect for the Constitution and for democratic rule, and yes, I’m aware that Trump doesn’t have sufficient respect for the Constitution either, but he will be gone in four years and these bureaucrats can be there for decades. Ultimately, if we’re going to put these organizations beyond the authority of the elected President to fire whoever he wants for whatever reason, we should recognize that there is a need for bipartisanship. There should be oversight committees that are required to have equal representation from both parties, or maybe each state can send their own auditor/inspector. We have to get to a point of democratic accountability, and the entrenched interests are likely to be fighting, kicking, and screaming the entire way there. It’s a battle that needs to be fought. Trump wasn’t and still wouldn’t be my first choice to do it, but it needs to be done.
The agency is prima facie unconstitutional. There is no oversight, no checks or balances. It is the worst of a very sad lot of government cronyism run amok.
Trumps move to shutter CFPB is anti- Warren. She is all about elite, top down control. Not a populist cell in her body.
No fan of Warren, but if one of Trump’s ‘Little Guys’ begins to find his credit card company starts ripping him off on the interest rate and he’s no protection do you think any connection made to CFPB? Maybe not, but maybe so. It’s all a fun game until…
There is a bill in the Senate, sponsored by Sanders and Hawley, with Trump’s reported support, that will cap CC interest at 10% for all affected voters for the next 5 years.
CFPB is Eliz Warren’s intrusion on the exec branch. Her little sandbox, helping her ideology, and painfully few regular folks.