May 17, 2024

Supreme Court Hands Biden Administration Huge Win

The Supreme Court just handed a huge win to the Biden administration and Senator Elizabeth Warren (D-MA).

The existence of the Consumer Financial Protection Bureau (CFPB), which was created by Warren, was at stake.

The funding of the agency was called into question by the payday loan industry, calling it unconstitutional.

Big Win for Warren and Biden

The ruling was 7-2 in favor of the agency, with only Justices Samuel Alito and Neil Gorsuch dissenting.

The agency oversees the banking industry, including payday loan centers, home mortgages, and credit cards.

The agency was established to combat corporate financial abuses after the infamous 2008 crash when the mortgage industry collapsed.

Because the agency is funded through the Federal Reserve rather than congressional appropriations, the banking industry claimed that it was in violation of the Constitution's Appropriations Clause.

Justice Clarence Thomas penned the majority opinion, which stated that while arguments were presented, none of them were convincing.

His ruling stated, "Under the Appropriations Clause, an appropriation is simply a law that authorizes expenditures from a specified source of public money for designated purposes.

"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."

A CFPB spokesperson applauded the decision, stating, "For years, lawbreaking companies and Wall Street lobbyists have been scheming to defund essential consumer protection enforcement.

"The Supreme Court has rejected their radical theory that would have devastated the American financial markets. The Court repudiated the arguments of the payday loan lobby and made it clear that the CFPB is here to stay."

In his dissent, Justice Alito stated, "The Framers would be shocked, even horrified, by this scheme.

"In sum, centuries of historical practice show that the Appropriations Clause demands legislative control over the source and disposition of the money used to finance Government operations and projects.”

Something tells me that this is not the last we have heard about this.

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