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Last week, the Congressional Budget Office issued its first estimate of how the U.S. national debt would change over the next 10 years as a result of the tax cut legislation now making its way through Congress.

That estimate came in the form of a November 8, 2017 letter from CBO Director Keith Hall to Rep. Richard Neal (D-MA), ranking member of the House Ways and Means Committee, in which Hall indicated that the CBO anticipated the publicly held portion of the national debt in the year 2027 would increase from 91.2% of GDP to 97.1% of GDP in that year if the House of Representatives bill H.R. 1, the Tax Cuts and Jobs Act, in its current form were to become law.

However, the publicly held portion of the national debt is just a fraction of the U.S. government’s total public debt outstanding, so those percentages don’t provide the full picture of how the U.S. national debt would change under H.R. 1.

To find out what the impact might be to the full national debt, we took the CBO’s baseline projections of the gross national debt for the years 2017 through 2027 as a percentage of GDP and added in the additional portion that the CBO’s director indicated the national debt would grow over that time. The following chart shows those results, along with historical data going back to 1967, where we’ve indicated the level of the national debt as a percentage of GDP at the beginning of each elected U.S. President’s term in office to provide some historical context.

Because the effect of the tax cuts wouldn’t show up until the U.S. government’s 2018 fiscal year, there would be no change in the CBO’s projections through 2017. Beginning in 2018 however, there is a gap that grows from year to year for the CBO’s different projections for the national debt.

Without any tax cuts, the U.S. national debt was projected to grow from 109.2% of GDP in 2017 up to 116.7% of GDP in 2027. Under the House’s version of the tax cut bill, the national debt would be projected to grow up to 122.6% under the CBO’s assumptions. This result also assumes that the proposed tax cuts would have no impact on the growth of GDP during the next decade.

At this writing, the CBO has not yet evaluated the Senate’s version of the tax cut bill.

Coincidentally, the CBO projects that the rate of growth of the total national debt from 2017 through 2027 with the tax cuts outlined in H.R. 1 would be about the same as was realized during President Obama’s second term in office.

It’s no surprise that the U.S. federal government does lots of stupid things. Sometimes, those things are meant to save money but, surprise surprise, those things really do the opposite and drive up costs instead.

A good example of this unintended effect can be found in Medicare’s Direct and Indirect Remuneration (DIR) fees on medications sold through pharmacies. Blair Thielemier of Pharmacy Times reports on what those fees are and how they affect Pharmacy Benefit Mangers (PBM):

The Centers for Medicare and Medicaid Services (CMS) created DIR fees as a way to track the annual amount of drug manufacturer rebates and other price adjustments applied to prescription drug plans impacting the total cost of Medicare Part D medications. The savings from rebates received by the PBM are passed on to the payer, which in this case is CMS.

DIR fees morphed from the original definition of DIR to a myriad of meanings, including the cost a pharmacy pays to participate in a PBM/plan’s network, the adjustment of the maximum allowable cost (MAC) and the contracted rate the plan reimburses the pharmacy for a medication, and the reimbursement or fee to a pharmacy for meeting or failing to meet certain quality measures.

It appears the original intention of DIR fees was to pass rebate savings from a PBM to Medicare; however, DIR fees are also fees a pharmacy pays a PBM for a network application or for filling a prescription. Although these fees have a place, the terms of DIR fees between pharmacies and PBMs are often cloaked in vague references. It can be difficult for the pharmacy to know how much the PBM/plan will reimburse the pharmacy for a prescription when the pharmacy enters into a contract, when the claim is processed, and when the contract ends.

That vagueness has proven to be costly, because in the interest of saving money, Medicare will claw back those fees from pharmacists months after the original point-of-sale transactions have occurred, where to compensate for the uncertainty for how much will be clawed back and the timing of when it will be clawed back, many pharmacists who operate their businesses on low margins are forced to raise the prices of prescription medication to Medicare consumers.

Writing at RealClearHealth, B. Douglas Hoey, the CEO of the National Community Pharmacists Association, describes the costly impact.

Retroactive DIR fees hurt our nation’s 22,000 independent pharmacies – small businesses that operate on razor-thin margins – by unexpectedly clawing back a portion of the price of a drug often months after a transaction, sometimes leaving the pharmacy upside down on the transaction. That’s no way to operate a business, and it hurts community pharmacies every day.

But pharmacies aren’t the only ones hurt. Our patients suffer too, and so does the Medicare program – and the American taxpayer. These after-the-fact fees lead directly to inflated prescription costs and higher cost-sharing for our Medicare patients because the higher costs drive many patients into the Medicare coverage gap faster. That’s what the Wakely research shows, as well as a January 2017 analysis by the Centers for Medicare & Medicaid Services that said DIR fees on pharmacies do not reduce the cost of drugs for beneficiaries at the point of sale and in fact push seniors into the “donut hole” coverage gap and, subsequently, the catastrophic phase of the Part D benefit faster.

There is legislation pending before the U.S. Congress that could repair the wasteful damage that Medicare is doing in its pursuit of cost savings through its clawback program. Hoey describes the findings of research that his organization funded to determine what benefits might be realized by the passage of the Improving Transparency and Accuracy in Medicare Part D Drug Spending Act (S. 413 / H.R. 1038) bill now pending in the U.S. Congress.

We have new research — commissioned by the National Community Pharmacists Association (NCPA) and prepared by Wakely Consulting Group, one of the top actuarial firms in the country — that establishes a private score for this legislation, estimating how much it will cost or save the federal government. Obviously, knowing that score is often essential to whether a piece of legislation will advance in Congress. Bills with significant price tags almost always have a tougher go of it.

But for the pharmacy DIR bill, the news is a real game-changer. The Wakely research shows that eliminating retroactive pharmacy payment reductions — or post point-of-sale pharmacy “DIR fees” — in Medicare Part D would save the federal government $3.4 billion over 10 years.

No, that’s not a typo. It really is billion with a “B.” Even when it comes to government spending, that’s a lot of money. Perhaps more importantly, the Wakely study shows that DIR legislation will result in extraordinary taxpayer savings without subtracting any benefits seniors currently receive. And for community pharmacies, banning these after-the-fact fees is the fair way to achieve predictability in reimbursements for the medications pharmacists buy and dispense.

Hoey’s organization obviously has an interest in the passage of the legislation, where what we’d really like to see is an independent confirmation of the actuarial research findings to confirm the potential benefit.

If those findings hold, the legislation should be a no-brainer for passage, where the reform it promises can reduce health care costs for consumers while also eliminating uncertainty for pharmacies, where everybody wins because the government stops doing stupid things.

During the heyday of the Affordable Care Act, also known as Obamacare, Emily Bazar of the Center for Health Reporting kept track of how Covered California, the ACA’s wholly owned subsidiary, actually performed. As she noted, Covered California wasted millions on promotion, handed out lucrative deals to cronies, and its $454 million computer system was dysfunctional. Last year Bazar showed how, despite skyrocketing premiums, Covered California dropped 2,000 pregnant women from coverage, causing them to lose their doctors and miss key prenatal appointments.

Earlier this year, Bazar reported that the state’s vaunted health exchange sent incorrect tax information to the health plans, which led to “higher premiums than consumers initially anticipated,” and people also “owed more out of pocket than they originally thought.” Bazar had already charted how Obamacare hiked premiums 13.2 percent, and canceled policies when people reported changes in income. As a result, many Californians did not get the tax credits they they sought. Covered California may have helped “multitudes” apply for health insurance, Bazar wrote, but “it also is responsible for countless glitches and widespread consumer misery.” So how is it performing now?

Emily Bazar, now with Kaiser Health News, warns that Anthem Blue Cross is pulling out of a large swath of California’s individual market, “forcing hundreds of thousands of consumers to find new plans.” Rate hikes average 12.3 percent and “silver-level” plans “will bear an additional 12.4 percent average surcharge.” Doctor’s networks are smaller and smaller all the time, and “if you are in the middle of treatment for a complex medical condition and lose your insurer, you may have options.” But then, you might not have options. So for all its lofty promises, Covered California still works best as a misery index.

The ACA was essentially a statist coup camouflaged in a white coat. In this plan, you get only the health care the government wants you to have. The same is true for the so-called “single player” scheme, better known as government monopoly health care.

If someone wanted to stop the U.S. government from wasting so much money, a very good place to begin would be to end the power that bureaucrats have to award multi-million dollar contracts without seeking any form of competition among the businesses they will rely upon to deliver results for U.S. taxpayers.

Writing in The Hill, David Williams of the Taxpayers Protection Alliance describes how the system is supposed to work, and what bureaucrats are doing to subvert practices that promote transparency for their own convenience.

Federal law requires “full and open competition” for most government procurements. Here’s how the bidding process traditionally works. The government publicly announces its need for a specific product or service — such as a year’s worth of public-school lunches or a new naval vessel. Companies submit sealed proposals, and the government chooses the lowest-cost, highest-quality bidder.

Naturally, there are exceptions to the open-bidding process. If there is only one company (a “sole source”) capable of providing a particular product or service, an agency can contract with that firm directly. Agencies can also forego open bidding if they deem it “necessary in the public interest.”

But at many agencies, no-bid contracts have become the rule, not the exception. The share of Pentagon contract spending awarded competitively has fallen almost every year since 2008. In fiscal year 2016, more than half of Defense Department procurement spending — totaling more than $100 billion — was on noncompetitive contracts.

The widespread adoption of no-bid contracting practices at multiple government agencies is a bureaucratic recipe for both bureaucratic corruption and failure.

So it is perhaps no surprise to find that such an arrangement has come to light in the U.S. territory of Puerto Rico, where it is contributing to keeping the lights off across the hurricane-wrecked island’s electrical infrastructure. Robert Walton of the utility industry trade publication UtilityDive provides a brief that the Puerto Rico government-owned utility company PREPA sought to avoid federal government oversight in placing a no-bid contract with a tiny Montana-based utility company.

Dive Brief:

• As Puerto Rico struggles to restore power to its citizens, a leaked recovery contract awarded to Montana’s Whitefish Energy appears to reveal one-sided commitments and stipulations that government agencies cannot review the project’s finances.
• Whitefish’s contract has been under increasing scrutiny. In the days after Hurricane Maria struck the island, the Puerto Rico Electric Power Authority (PREPA) declined mutual aid offers from other utilities, opting for a $300 million contract with the little-known Montana firm for power restoration.
• And with most of Puerto Rico still without power, Rhodium Group has run the numbers and determined that Hurricane Maria’s hit on the island has caused the largest blackout in the United States’ history. The storm has so-far disrupted 1.25 billion hours of electricity supply for American citizens, and three quarters of the island still has no power. To date, that’s about twice the length of outages caused by Hurricane Katrina in 2005.

The Federal Emergency Management Agency (FEMA) has specifically disavowed having any role in the no-bid contract between PREPA and Whitefish. On October 30, 2017, the Puerto Rico government-owned utility cancelled the contract, just ahead of the announcement that the Federal Bureau of Investigation (FBI) was launching a criminal probe into the arrangement.

In Puerto Rico’s case, one could make the argument that the need to establish a no-bid contract to restore electrical power to the territory is “necessary in the public interest”, if only the firm being contracted to do the recovery work were capable from Day 1 of rapidly executing its role. But these kinds of contracts are also being made for non-emergency situations by federal government agencies. John Crudele of the New York Post has been following the money for no-bid contracts placed by the U.S. Census Bureau.

Government investigators found problems with 90 percent of the no-bid contracts awarded by the Census Bureau.

That finding, after combing through just 28 deals, determined that Census probably overpaid contractors by about $9 million.

The U.S. Census Bureau does a lot of valuable work, but none of it can be considered to be any form of emergency response requiring rapid action that can only be arranged through no-bid contracts with outside entities. And yet, it is spending millions of dollars without providing any evidence that it is delivering the best value for U.S. taxpayers.

Crudele does offer a solution:

Here’s what I think — put a couple of government officials in prison for fraud and the nonsense will end. Up until now, all the government does is criticize unethical practices and allow the offenders to slink away quietly into retirement.

It’s time for the Justice Department to investigate the sort of thing the IG — and I — found and treat it as the crime that it is.

You and I wouldn’t get away with this sort of fraud and public servants shouldn’t either.

No they shouldn’t.

Have you ever wondered what it is like to work for a failing enterprise, when that enterprise is a government?

Diana Sroka Rickert recently had that experience after she accepted a high-level position with Illinois’ state governor’s office. She would go on to leave that job after just a matter of weeks of growing frustration, describing what that state government’s highly dysfunctional environment was like:

Throughout all levels of state government, what permeated the most was an overall attitude of defeat. There was no sense of purpose. No hunger to do more, push further or to succeed.

No acknowledgment that this is a state government that is ranked last by almost every objective and measurable standard. A state government that fails every single one of its residents, day after day — and has failed its residents for decades. A state government that demands more and more money each year, to deliver increasingly less value to Illinoisans. A state government that cannot pay its bills, cannot make good on its promises, cannot help people in need.

The games that were played in the office, the problems that would be easily resolved if anyone cared, the inability to get an initiative off the ground … it was almost like a running joke, or some sick rite of passage. It was as if the culture said, “You’re not a real state employee until you’re bolting out the door after 7.5 hours with nothing to show for it.”

It was appalling to see how self-absorbed so many staffers and former staffers were. Here they are in a state government that is crumbling — heck, in a building that is literally falling apart — yet at the end of the day what they care about the most is themselves….

I experienced this in a very personal way when these exact people characterized my resignation as a termination — even though the governor’s own statement said I resigned. This type of behavior was not surprising to me because these are people who believe they raise themselves up by pushing someone else down, and who do not care about what is best for Illinois. I consider it a badge of honor that they felt the need to attack me on my way out because it was made very clear: I am not one of them.

It’s no fun to work with nasty people who use the power they have to put their own interests ahead of those they claim to serve, to the point where they create a hostile work environment for their peers. Unsurprisingly, in the context of a state government, not much in the way of needed reform on behalf of the public interest can get done, so it goes undone.

From the White House on down, the National Football League is getting a bad rap over anthem antics by some players. That is a shame, because the league, the game, and the players can teach valuable lessons, particularly for those in government.

If your daddy was governor of California, like Jerry Brown’s, or President of the United States, like George W. Bush’s, that provides easy entry for a career in politics. Not so in professional sports, particularly the National Football League.

No NFL team drafts a player because his father was politician, or because daddy owns the team or the stadium. Even those players whose fathers did play in the NFL, such as Peyton Manning, Kellen Winslow Jr. and Christian McCaffrey, earned their job on the basis of pure merit, like everybody in the NFL.

Ray Seals, Eric Swann, Sav Rocca, and Lawrence Okoye came to the league right out of high school. Many others left college early, rather than risking injury to play for no salary at all.

Nigerian track star Christian Okoye had never played football but quickly proved his worth in the NFL, where players know that raw talent is not enough.

Jerry Rice put himself through workouts that would challenge a Navy SEAL. That’s why he excelled. Larry Fitzgerald has balls thrown to him while hanging upside down, which helps him make catches on the field.

Off the field, NFL players also do things to make other people better. Houston Texans defensive end J.J. Watt raised more than $37 million for relief following the disastrous Hurricane Harvey.

Politicians like to slide business to their cronies, but the NFL is not like that. The football field is level, not tilted in the direction of one team. The rules are the same for all players, and no special rule gives any player a first down for advancing only seven yards.

In the NFL, no runner has to slow down because some other player might not feel good about himself. In the NFL, all achievement is earned. The players, not the owners or league bosses, determine the winners and losers.

Penalties are the same for all players and the game does not proceed until the referees mark off the penalty. That is not always the case in government, where officials caught in criminal conduct are protected from prosecution and allowed to retire.

In the wake of the anthem protests, Houston Texans owner Bob McNair said “we can’t have inmates running the prison.” He has since apologized and the statement was a stretch. Some NFL players have indeed run afoul of the law, but they are hardly unique in that regard.

As Mark Twain said, “there is no distinctly American criminal class – except Congress.” In California, some are calling for politicians to get two terms, one in office and one in prison.

The NFL, meanwhile, can be entertaining and instructive but nobody has to watch it. On the other hand, as George Orwell noted, there is no such thing as keeping out of politics. So in the big picture, politicians are a more appropriate target than football players, whatever their antics during the national anthem.

Back in 2012, Americans who sought smaller government, and believed that they were taxed enough already, geared up for the election. Trouble was, the Internal Revenue Service targeted them for harassment on the basis of their political beliefs. Last week, the Trump administration agreed to pay $3.5 million to the so-called tea party groups, but as Stephen Dinan of the Washington Times observes, there’s more to the story.

The settlement was announced by Attorney General Jeff sessions, who offered an apology to the 450 groups that had sued the IRS, the most powerful and intrusive agency in the federal government. The IRS itself did not issue an apology, and was not talking to reporters. A key player in the harassment was Lois Lerner, who destroyed evidence and endlessly took the Fifth. She was not fired and the government allowed her to resign. The previous administration claimed Lerner was trying to stop the harassment but as Dinan explains, the Justice Department and IRS “now say she failed to stop her employees and hid the bad behavior from her bosses for two years.”

Former IRS helmsman Stephen Miller said nobody had been targeted and that it was all a matter of “horrible customer service,” as though the IRS was a business producing products that people actually wanted. Miller incurred no penalty and the government brought in John Koskinen, a skilled prevaricator and a real piece of work. As we noted, Koskinen obstructed investigators at every turn, misleading Congress about the destruction of Lois Lerner’s emails. Koskinen was not fired then and he is not being fired now. As Dinan notes, he is “due to leave the agency early next month” with no penalty of any kind and no apology, official or otherwise.

The harassed groups may welcome the $3.5 million settlement but it’s too little and too late. Here’s the deal. IRS bosses can deprive Americans of their constitutional rights, subject them to harassment, then walk away unharmed and not even have to say they are sorry. Taxpayers can be forgiven for believing that the Internal Revenue Service is unaccountable to the people and essentially unreformable.

During the last two presidential administrations, Environmental Protection Agency (EPA) bureaucrats seeking to increase their regulatory power would often engage in secret collusion with political activists to either deliberately throw court cases where the EPA was being sued or to settle them without contest to achieve that end. Michael Bastasch of the Daily Caller News Foundation reports on the estimated cost to the U.S. economy stemming from that unusual form of bureaucratic corruption:

The right-leaning American Action Forum found 23 regulations stemming from “sure and settle” lawsuits “resulted in a total cost burden of $67.9 billion, with $26.5 billion in annual costs.”

AAF looked at 23 major regulations imposed by EPA from 2005 to 2016, and found they resulted in hefty economic price tags. Settlements reached during the Bush and Obama administrations resulted in some of the costliest rules on the books.

“With billions of dollars in economic costs at stake, it makes sense to more thoroughly scrutinize sue and settle rules to ensure they meet the basic rigors of the Administrative Procedure Act and sound cost-benefit principles,” AAF’s Dan Bosch wrote in a new report.

Earlier this month, EPA administrator Scott Pruitt officially put an end to this secretive, backdoor process for increasing the regulatory power of the EPA without going through the legitimate regulatory process established by the U.S. Congress. Bloomberg‘s Jennifer Dloughy has the story.

EPA Administrator Scott Pruitt said he is ending a “sue-and-settle” practice that has resulted in closed-door agreements committing the agency to regulating greenhouse gas emissions or mercury pollution from power plants.

“It’s very important that we do not engage in rulemaking through litigation,” Pruitt told reporters at a briefing Monday. “As of today, with this directive and the memorandum, we’re no longer going to be involved in that practice.”

Pruitt vowed to avoid “regulation through litigation” in an address to EPA employees in February and later instructed agency staff to limit the practice. Separately, Attorney General Jeff Sessions has barred federal attorneys from negotiating settlements that result in payments from companies to third-party organizations, such as environmental groups.

But Pruitt’s new directive makes it formal. Under the policy, the agency will publicize petitions targeting the EPA, include states and regulated entities in settlements that affect them and publish proposed agreements so that the public has 30 days to comment. The EPA also won’t agree to issue rules quickly through the settlement process, Pruitt said. Under the new policy, the agency will also exclude paying attorney fees.

No matter what side of the political aisle you might be, this reform represents a step forward in achieving greater transparency and integrity in how the U.S. government’s regulations on Americans are established.

Political Calculations tallies up the most recent accounting of the amount of money that the U.S. government owes to its major creditors:

The U.S. government’s 2017 fiscal year officially ended on 30 September 2017. From the end of its 2016 fiscal year (FY2016) a year earlier, the total public debt outstanding of the U.S. government increased by $671.5 billion, rising from $19,573 billion (or $19.6 trillion) to $20,245 billion (or $20.2 trillion) during FY2017.

The following chart shows the major breakdown of who the U.S. government has borrowed that total $20.2 trillion from:

According to the U.S. Treasury Department, the U.S. government spent some $665.7 billion more than it collected in taxes during its 2017 fiscal year. The difference between this figure and the $671.5 billion that the total national debt actually rose can be attributed to the government’s net borrowing to fund things like Federal Direct Student Loans, which collectively account for nearly $1.1 trillion of the government’s $20.2 trillion debt, or 5.4% of the total public debt outstanding.

Put differently, the U.S. national debt would be 5.4% less at roughly $19.1 trillion if not for the federal government’s takeover of the student loan industry from the private sector in March 2010. Since that time, approximately $1 of every $10 that the U.S. government has borrowed has been for the purpose of funding its student loan program.

Overall, 69% of the U.S. government’s total public debt outstanding is held by U.S. individuals and institutions, while 31% is held by foreign entities. China has resumed its position as the top foreign holder of U.S. government-issued debt, with directly accounting for 6.9% between institutions on the Chinese mainland and Hong Kong.

Beyond that, China likely has additional holdings that are currently being shown as being held in the international banking centers of Belgium and Ireland, which together account for 2.0% of the U.S. national debt, where China’s holdings are believed to represent a significant portion of the amounts currently being credited to both these nations.

The largest single institution holding U.S. government-issued debt is Social Security’s Old Age and Survivors Insurance Trust Fund, which is considered to be an “Intragovernmental” holder of the U.S. national debt, and which holds 13.9% of the nation’s total public debt outstanding. The share of the national debt held by Social Security’s main trust fund is expected to fall as that government agency cashes out its holdings to pay promised levels of Social Security benefits, where its account is expected to be fully depleted in just 17 years. Under current law, after Social Security’s trust fund runs out of money in 2034, all Social Security benefits would be reduced by 23% according to the agency’s projections.

The largest “private” institution that has loaned money to the U.S. government is the U.S. Federal Reserve, which accounts for nearly one out of every eight dollars borrowed by the U.S. government. It lent nearly all of that total since 2008, mainly through the various quantitative easing programs it operated from 2009 through 2015 in its attempt to stimulate the U.S. economy enough to keep it from falling back into recession. In September 2017, the Fed announced that it would begin reducing its holdings of U.S. government-issued debt.

An important question to ask is “how fast is the national debt accumulating?” To find out, we pulled data from the U.S. Treasury Department, where we find that since being sworn into office nine months ago, the U.S. government’s total public debt outstanding has increased by nearly $484 billion.

By contrast, during President Obama’s first nine months in office, the U.S. national debt increased by nearly $1,326 billion (or $1.326 trillion), about 2.7 times the rate under President Trump. During President Obama’s last nine months in office, the U.S. national debt increased by nearly $732 billion, one and a half times faster than the rate seen during President Trump’s first nine months in office.

The observation we’re making here is that it is the rate at which the national debt is increasing that most affects the behavior of politicians. Under President Obama, that rate was viewed as unacceptable in his first years in office, which resulted in President Obama’s party losing control of the U.S. Congress. That event, more than any other, did more to slow the growth of the U.S. national debt during the rest of President Obama’s tenure in office, where presumably, by the end of that tenure, most politicians were comfortable with the rate at which the U.S. national debt was growing.

Now in 2017, the rate at which the U.S. national debt is increasing is slower than at any time outside of periods where it ran into the national debt ceiling during President Obama’s occupancy of the oval office. Politicians of both major political parties who came to be comfortable with that rate of national debt growth now see opportunities to both reduce taxes and to allow higher levels of spending, which would increase the rate at which the national debt is growing today.

Perhaps a better question to ask is whether those same politicians should be so comfortable with that point of view?

Corey Lewandowski, an outside advisor to Donald Trump, wants the president to fire federal Consumer Financial Protection Bureau boss Richard Cordray. Lewandowski doesn’t like CFBP rules that make it easier to sue finance companies, but firing Cordray will not be easy. He can only be fired for cause, and that entails a burden of proof. Like the boss, the CFPB itself enjoys special protection.

As a federal agency, it should be funded by Congress, but it isn’t. The CFPB is funded by the Federal Reserve, which is obviously improper. The CFPB has no board to oversee its affairs and Cordray basically calls all the shots. That too is unacceptable, and no surprise that, according to former employees, the CFPB is secretive, partisan and obstructionist. Taxpayers can’t be blamed for seeing the CFPB, the brainchild of Sen. Elizabeth Warren, as bad idea in the first place.

As we noted back in 2012 in Financial Crisis and Leviathan, the CFPB was created during the greatest financial crisis since the Great Depression, not a good time to expand government. The previous administration failed to consider that any government or policy, such as the Carter-Era Community Reinvestment Act, with its lax lending standards, could have played any role in the crisis. The CFPB was based on the assumption that even educated and informed consumers were unable to look out for themselves without help from federal bureaucrats. The CFPB duplicated the work of existing bank regulators and amounted to pure government building, larding up Leviathan through a crisis government played a major role in causing.

As Milton Friedman observed, creating new agencies and programs is easy but eliminating them is practically impossible. Now is the time to show that it can be done. President Trump should fire CFPB boss Cordray and Congress should eliminate the CFPB at the earliest opportunity. That will trim waste and help restore accountability in government.