consumer

WASHINGTON — Republicans have suffered a sizable setback on one key aspect of President Trump’s big bill after their plans to gut the Consumer Finance Protection Bureau and other provisions from the Senate Banking Committee ran into procedural violations with the Senate parliamentarian.

Republicans in the Senate proposed zeroing out funding for the CFPB, the landmark agency set up in the aftermath of the 2008 financial crisis, to save $6.4 billion. The bureau had been designed as a way to better protect Americans from financial fraud, but has been opposed by many GOP lawmakers since its inception. The Trump administration has targeted the CFPB as an example of government overregulation and overreach.

The findings by the Senate parliamentarian’s office, which is working overtime scrubbing Trump’s overall bill to ensure it aligns with the chamber’s strict “Byrd Rule” processes, signal a tough road ahead. The most daunting questions are still to come, as GOP leadership rushes to muscle Trump’s signature package to the floor for votes by his Fourth of July deadline.

Sen. Tim Scott (R-S.C.), the chairman of the Banking Committee that drafted the provisions in question, said in a statement, “My colleagues and I remain committed to cutting wasteful spending at the CFPB and will continue working with the Senate parliamentarian on the Committee’s provisions.”

For Democrats, who have been fighting Trump’s 1,000-page package at every step, the parliamentarian’s advisory amounted to a significant win.

“Democrats fought back, and we will keep fighting back against this ugly bill,” said Sen. Elizabeth Warren of Massachusetts, the top Democrat on the Banking Committee, who engineered the creation of the CFPB before she was elected to Congress.

Warren said that GOP proposals “are a reckless, dangerous attack on consumers and would lead to more Americans being tricked and trapped by giant financial institutions and put the stability of our entire financial system at risk — all to hand out tax breaks to billionaires.”

The parliamentarian’s rulings, while advisory, are rarely, if ever ignored.

With the majority in Congress, Republicans have been drafting a sweeping package that extends some $4.5-trillion tax cuts Trump approved during his first term, in 2017, that otherwise expire at the end of the year. It adds $350 billion to national security, including billions for Trump’s mass deportation agenda. And it slashes some $1 trillion from Medicaid, food stamps and other government programs.

All told, the package is estimated to add at least $2.4 trillion to the nation’s deficits over the decade, and leave 10.9 million more people without healthcare coverage, according to the nonpartisan Congressional Budget Office’s review of the House-passed package, which is now undergoing revisions in the Senate.

The parliamentarian’s office is responsible for determining if the package adheres to the Byrd Rule, named after the late Sen. Robert Byrd of West Virginia, who was considered one of the masters of Senate procedure. The rule essentially bars policy matters from being addressed in the budget reconciliation process.

Senate GOP leaders are using the budget reconciliation process, which is increasingly how big bills move through Congress, because it allows passage on a simple majority vote, rather than face a filibuster with the higher 60-vote threshold.

But if any of the bill’s provisions violate the Byrd Rule, that means they can be challenged at the tougher 60-vote threshold, which is a tall order in the 53-47 Senate. Leaders are often forced to strip those proposals from the package, even though doing so risks losing support from lawmakers who championed those provisions.

One of the biggest questions ahead for the parliamentarian will be over the Senate GOP’s proposal to use “current policy” as opposed to “current law” to determine the baseline budget and whether the overall package adds significantly to deficits.

Already the Senate parliamentarian’s office has waded through several titles of Trump’s big bill, including those from the Senate Armed Services Committee and Senate Energy & Public Works Committee.

The Banking panel offered a modest bill, just eight pages, and much of it was deemed out of compliance.

The parliamentarian found that in addition to gutting the CFPB, other provisions aimed at rolling back entities put in place after the 2008 financial crisis would violate the Byrd Rule. Those include a GOP provision to limit the Financial Research Fund, which was set up to conduct analysis, saving nearly $300 million; and another to shift the Public Company Accounting Oversight Board, which conducts oversight of accounting firms, to the Securities and Exchange Commission and terminate positions, saving $773 million.

The GOP plan to change the pay schedule for employees at the Federal Reserve, saving $1.4 billion, was also determined to be in violation of the Byrd Rule.

The parliamentarian’s office also raised Byrd Rule violations over GOP proposals to repeal certain aspects of the Inflation Reduction Act, including on emission standards for some model year 2027 light-duty and medium-duty vehicles.

Mascaro writes for the Associated Press. AP writer Mary Clare Jalonick contributed to this report.

BALTIMORE — A federal judge has blocked the terminations of three Democratic members of the Consumer Product Safety Commission after they were fired by President Trump in his effort to assert more power over independent federal agencies.

The commission helps protect consumers from dangerous products by issuing recalls, suing errant companies and more. Trump announced last month his decision to fire the three Democrats on the five-member commission. They were serving seven-year terms after being nominated by President Biden.

After suing the Trump administration last month, the fired commissioners received a ruling in their favor Friday; it will likely be appealed.

Attorneys for the plaintiffs argued the case was clearcut. Federal statute states that the president can fire commissioners “for neglect of duty or malfeasance in office but for no other cause” — allegations that have not been made against the commissioners in question.

But attorneys for the Trump administration assert that the statute is unconstitutional because the president’s authority extends to dismissing federal employees who “exercise significant executive power,” according to court filings.

U.S. District Judge Matthew Maddox agreed with the plaintiffs, declaring their dismissals unlawful.

He had previously denied their request for a temporary restraining order, which would have reinstated them on an interim basis. That decision came just days after the U.S. Supreme Court’s conservative majority declined to reinstate board members of two other independent agencies, endorsing a robust view of presidential power. The court said that the Constitution appears to give the president the authority to fire the board members “without cause.” Its three liberal justices dissented.

In his written opinion filed Friday, Maddox presented a more limited view of the president’s authority, finding “no constitutional defect” in the statute that prohibits such terminations. He ordered that the plaintiffs be allowed to resume their duties as product safety commissioners.

The ruling adds to a larger ongoing legal battle over a 90-year-old Supreme Court decision known as Humphrey’s Executor. In that case from 1935, the court unanimously held that presidents cannot fire independent board members without cause. The decision ushered in an era of powerful independent federal agencies charged with regulating labor relations, employment discrimination, the airwaves and much else. But it has long rankled conservative legal theorists who argue the modern administrative state gets the Constitution all wrong because such agencies should answer to the president.

During a hearing before Maddox last week, arguments focused largely on the nature of the Consumer Product Safety Commission and its powers, specifically whether it exercises “substantial executive authority.”

Maddox, a Biden nominee, noted the difficulty of cleanly characterizing such functions. He also noted that Trump was breaking from precedent by firing the three commissioners, rather than following the usual process of making his own nominations when the opportunity arose.

Abigail Stout, an attorney representing the Trump administration, argued that any restrictions on the president’s removal power would violate his constitutional authority.

After Trump announced the Democrats’ firings, four Democratic U.S. senators sent a letter to the president urging him to reverse course.

“This move compromises the ability of the federal government to apply data-driven product safety rules to protect Americans nationwide, away from political influence,” they wrote.

The Consumer Product Safety Commission was created in 1972. Its five members must maintain a partisan split, with no more than three representing the president’s party. They serve staggered terms.

That structure ensures that each president has “the opportunity to influence, but not control,” the commission, attorneys for the plaintiffs wrote in court filings. They argued the recent terminations could jeopardize the commission’s independence.

Attorney Nick Sansone, who represents the three commissioners, praised the ruling Friday.

“Today’s opinion reaffirms that the President is not above the law,” he said in a statement.

Skene writes for the Associated Press.

For the first time, sports fans will be able to subscribe to ESPN without signing up for satellite or cable TV. It will cost $29.99 a month.

The Walt Disney Co. unit announced Tuesday that the new direct-to-consumer streaming service will go by the legacy name ESPN, a sign that the sports media behemoth sees streaming as the future. The launch date will be in early fall.

The standalone service will provide live feeds of all ESPN channels including ESPN2, ESPNU, SECN, ACCN, ESPNEWS and ESPN Deportes. Users will also be able to stream ESPN productions airing on the ABC broadcast network, which include the NBA Finals and “Monday Night Football.”

The service will also be available in a streaming bundle, where consumers can get ESPN, Disney + and Hulu for $35.99. The bundle plan will be available at a discounted $29.99 for the first year.

“It’s going to redefine our business,” ESPN Chairman Jimmy Pitaro said at a press briefing held at Disney’s New York headquarters in lower Manhattan.

The unveiling of the new product is a significant moment for the company. The current streaming service ESPN+ offers the channels, but only to users who have pay TV.

As younger consumers have moved to streaming, they have left behind the cable universe their parents lived with. The new ESPN streaming product is aimed at attracting sports fans who are not buying pay TV.

“Our priority is looking at the 60 million households on the sidelines,” Pitaro said.

Pitaro said the brand name has meaning to younger consumers who spend time with it on social media and digital platforms even if they don’t watch on cable.

ESPN has long received the biggest cut of cable bills and as a result felt the most pain as consumers were giving up their pay-TV subscriptions. The network has managed to offset that revenue loss with increases in ad revenue and cost-cutting.

Under Pitaro’s watch, ESPN has locked up a number of major sports rights deals in recent years that he believes will strengthen the streaming offering. Last year, the company finalized a new 11-year deal to keep the NBA.