Democrats in the House of Representatives voted on Wednesday against an amendment to a proposed bill that would prevent the Consumer Financial Protection Bureau (CFPB) from forcing credit reporting agencies to evaluate Americans based on political opinions or religious beliefs.
Without such an amendment, Republicans warn, the powerful CFPB would have the legal authority to make nearly any criteria mandatory for a private credit evaluation company to take into consideration, paving the way for a system in which the federal government has the power to assign numerical scores to individuals based on their loyalty to a certain political party, membership in civil society groups that the government approves or disapproves of, or other private behaviors.
The system, they say, would mirror the newly minted “social credit system” in place in China, which bans citizens from key social services like public transportation if they lose too many points behaving in a way the Communist Party disapproves of.
The CFPB, the brainchild of Senator Elizabeth Warren (D-MA), is an executive agency that does not answer to the presidency, making it unaccountable to anyone but its head. The constitutionality of giving an unelected body the power to impose its demands on private individuals and corporations has been the subject of extensive debate, and the unique power given to a bureau director triggered an aggressive fight for the seat after founding director Richard Cordray, chosen by President Barack Obama, resigned.
Republicans moved on Wednesday to amend the 1970 Fair Credit Reporting Act in light of the existence of the CFPB. The failed amendment would have prevented the Bureau from forcing private credit scoring companies to “make use of information related to political opinions, religious expression, or other expression protected by the First Amendment, whether obtained from a social media account of a consumer or other sources.”
The amendment would have been tacked onto Rep. Ayanna Pressley’s (D-MA) Student Borrower Credit Improvement Act, or Comprehensive CREDIT Act of 2020, which grants the CFPB power to order private credit evaluation companies not to take into account what Pressley and her fellow Democrats consider unfair criteria. Having bad credit could keep an American from buying a car or a home, limiting their economic potential. Pressley’s bill would, in particular, prevent unexpected medical expenses or unpaid student loans from harming a person’s credit.