Richard Cordray, director of the Consumer Financial Protection Bureau, says that it has already received, as of September 21, over half a million comments to its 1,334-page proposed payday lending rule, “with many more expected.” It is quite possible that a million Americans or more had submitted comments when the window for submitting them closed last Friday. Unfortunately, the evidence is mounting that the Bureau intends to ignore the vast majority of them.
As the Community Financial Services Association of America learned this year from documents produced in response to a FOIA request, the CFPB’s “Tell Your Story” initiative elicited a total of 12,546 comments regarding payday lending; 12,308 of them praised the industry and its products and services or otherwise indicated positive experiences with them. Even so, the Bureau decided the industry needed to be regulated out of business.
It should come as little surprise, therefore, that the Bureau now seems to be ready to begin the final rule-writing process before it even opens possibly more than a million letters in opposition that very rule. To date, fewer than 100,000 of these comments have even found their way onto the regulation website. The agency charged with protecting financial consumers seems to have little, if any, desire to learn about them, much less listen to them.
The Bureau’s lackadaisical approach to rulemaking runs afoul of both the letter and the spirit of the Administrative Procedure Act (APA). Before promulgating a legislative rule, an agency must “give interested persons an opportunity to participate in the rulemaking through submission of written data, views, or arguments with or without opportunity for oral presentations” (5 U.S.C. 553[c]). “Anyone and everyone is allowed to express himself,” as Kenneth Culp Davis explains in Discretionary Justice (1969), “and to call attention to the impact of various possible policies on his business, activity, or interest.”
Allowing the public to comment on proposed regulations that will bind them with the same force as a congressionally enacted statute not only promotes reasoned decision-making but also ensures that the administrative process remains both participatory and democratic. An agency must review comments and respond to those that have made significant arguments, raised significant concerns, or presented the agency with data of which it had been unaware, as the U.S. Supreme Court ruled last year in Perez v. Mortgage Bankers Association. Indeed, as a federal court observed in Home Box Office, Inc. v. FCC (1977), “the opportunity to comment is meaningless unless the agency responds to significant points raised by the public.”
The APA does not permit our government to ignore the voices of the governed. The D.C. Circuit Court in 1989 (Laclede Gas Co. v. F.E.R.C.) noted the “ready analogy between rulemaking’s notice-and-comment procedures and the democratic process.” Just as every vote must be opened and counted, so too must every commenter’s submission be opened and considered. And if the APA is not to become a tool for subverting democratic accountability, an agency must take account of the level of opposition voiced by those whom a proposed rule purports to protect. A rule that elicits nearly a million comments from the American people is certainly a rule for which the Congress, not an unelected and unaccountable bureaucrat, should reasonably bear responsibility under our constitutional system of representative government.
Americans are asking that their voices be heard. If the effort that the bureaucrats at the CFPB are making simply to process those comments is any indication, they have little if any desire to listen to those voices and no intention of responding to their concerns. This approach to rulemaking constitutes an arrogant assertion of raw administrative power that is antithetical not only to the Administrative Procedure Act but to our very system of democratic and representative government.