Senate Republicans are currently short of the votes they need to overturn a critical consumer protection rule, Sen. John Thune, a member of Republican leadership from South Dakota, said on Tuesday.
With all eyes on health care, the urgency of Puerto Rico’s humanitarian crisis, and President Donald Trump’s ongoing NFL feud, Senate Republican leaders are scrambling to secure the votes to overturn a Consumer Financial Protection Bureau rule that bars companies from forcing consumers into arbitration in boilerplate contracts nobody reads. If they are successful, they will effectively be protecting financial companies from class-action lawsuits and forcing consumers to forfeit their right to a day in court.
When asked by The Intercept whether he expects a vote this week, Thune said he wasn’t sure. The decision, he said, is a “judgment call the leader will have to make about what he slots in given the opening that we now have,” referring to the Graham-Cassidy health care bill that was killed on Tuesday, freeing the Senate up to focus on other legislation.
Asked if one problem was a lack of votes, Thune said yes. “There are some issues related to that, that I think are still being worked on, and I suspect that it probably won’t come up unless they think, unless [Senate Majority Leader Mitch McConnell is] convinced we have the votes for it. They’ve been whipping it,” he said.
Meanwhile, the House has already passed a resolution overturning the rule.
Sen. Lindsey Graham, R-S.C., opposes the move and several other Republicans are undecided, including Sen. John Kennedy of Louisiana and Sen. Susan Collins of Maine. Sens. Lisa Murkowski, R-Alaska, and Rob Portman, R-Ohio, have not publicly supported the vote either. The 52 Senate Republicans can only lose two votes if they want to meet the 50-vote threshold they need to move forward, as Democrats are confident they can put up a unified opposition.
Senate Minority Leader Chuck Schumer said in a press conference Wednesday that passing a repeal on CFPB’s rule “is the equivalent of Republicans handing out a get-out-of-jail-free card to Wells Fargo and to Equifax,” and “a green light to Wall Street to be free to continue to hose consumers without any consequences.”
“Why, in the wake of some of the most malicious, nasty, disgusting actions we’ve seen since Enron, would the Senate limit the power of the average person in favor of helping corporate America avoid punishment for very severe misdeeds?” Schumer said.
“We can’t let this happen,” he said. “We are all dedicated to fighting it from happening. Our Republican colleagues shouldn’t even think of bringing a provision that would defang any rights consumers have to the floor because we’ll do everything we can to fight it and to defeat it.”
Executives for Wells Fargo and Equifax, the credit reporting bureau that made headlines after waiting months to report one of the greatest data breaches in history, will testify in Senate committees next week.
Equifax is encouraging the 143 million people it exposed to identity theft to enroll in TrustedID Premier, a free, one-year service that also includes an arbitration clause in its terms of service. Such arbitration clauses force customers to waive their right to enter into a class action lawsuit while pushing all disputes out of court, handing the little power consumers have over to the company.
Both Equifax and Wells Fargo have used arbitration clauses to block class-action lawsuits. CFPB proposed a rule to ban arbitration clauses from all consumer agreements in early 2016. The rule was finalized in July and is set to go into effect next March, which explains why Republicans are rushing to stop it.
Overturning the rule before Wells Fargo and Equifax executives come to Congress would be ideal for repeal proponents, given that the hearings are likely to shed light on how financial companies distort the justice system to continue to take advantage of consumers. The executives are unlikely to make sympathetic figures, and even Republicans on the panel will be incentivized to pound away at them.
The clock is ticking for the Senate to reverse the rule. Congress has 60 legislative days from the publication of a rule in the Federal Register to use a special resolution to disapprove of regulations under limited debate and without possibility of filibuster. The CFPB rule was published July 19, and according to the Senate legislative calendar, today is the 34th day the chamber has been in session since then. So, depending on breaks in the schedule, the Senate has until roughly sometime in early November to kill the rule.