Battle over control of watchdog agency heats up

This is a rush transcript from "Special Report with Bret Baier," November 27, 2017. This copy may not be in its final form and may be updated.


MICK MULVANEY, ACTING DIRECTOR OF THE CONSUMER FINANCIAL PROTECTION BUREAU: He wants me to fix it, he wants me to get it back to the point where it can protect people without trampling on capitalism, without choking off the access to financial services that are so critical to so many folks.

SENATE MINORITY LEADER CHARLES SCHUMER, D-N.Y.: The only reason the Trump administration would put Mr. Mulvaney forward for this position would be so he can rot the agency from the inside. Mr. Mulvaney is only the latest in a long line of Trojan horse candidates selected by the White House to undermine federal agencies from within.


BRET BAIER, ANCHOR: There you see the Senate minority leader on what he thinks the choice for White House budget director Mick Mulvaney now, according to the White House, the acting director of the Consumer Financial Protection Bureau. However, the lady on the left side of the screen, Leandra English, started this day thinking that she was still the director, appointed by the outgoing director. She was the deputy there. Mulvaney came in, essentially delivering doughnuts, saying this is my job and I'm going to that the desk and then later held a news conference saying I'm the guy.


MULVANEY: She sent out an email this morning purporting to be the acting director. We disagree with that in the administration, so I want to make it clear to folks working here that we didn't consider her to be the acting director.

SARAH SANDERS, WHITE HOUSE PRESS SECRETARY: A lot of the past practices under the previous director and the previous administration were used more to advance political ambitions and not about protecting American consumers which is what that's supposed to be. And our goal is to make sure we get back to that.


BAIER: What about this? And we will also talk about tax reform and everything else. Let's bring in our panel: Jonathan Swan, national political reporter for Axios; A.B. Stoddard, associate editor at Real Clear Politics and host of "No Labels" Radio on Sirius XM, and Mollie Hemingway, senior editor at The Federalist.

This was quite the thing this morning, Jonathan. It seems like the courts are getting involved here and Mulvaney probably is going to just continue as is.

JONATHAN SWAN, AXIOS: And it looks like he will probably prevail because you have the Department of Justice issuing an opinion saying he is legally in that role, and you also have the counsel inside the bureau supporting that decision. So he looks to be on legally solid ground.

But I think this just is, it just reveals how toxic the city has become. This is the most meaningless dispute. This is a role that is interim. The president is going to replace the person, and we are already in a lawsuit. A lawsuit starts flying after 48 hours. It's quite incredible the way this played out.

BAIER: Yes, but to Senator Schumer's point, Mick Mulvaney has not been somebody who says the CFPB is a great place. In fact he called it a sad joke and there is a sense that part of that reason is to turn the whole thing around, to stop what it's doing.

MOLLIE HEMINGWAY, THE FEDERALIST: I would disagree that it's meaningless. I actually think it's a very important bureau. It was designed, it might have had good intentions. As it has been in practice it has been almost without restraint in what it can go after and the penalties that can be levied against groups that it decides needs to be levied against.

Republicans have long claimed this bureau is corrupt and unaccountable and unconstitutional. And this response we are seeing from that bureaucracy and Democrats on the Hill seems to be saying that's exactly how we wanted and that's how we designed it. But in addition to the Office of Legal Counsel and the Department of Justice and the other legal opinions, there are some previous precedents showing the president does, as we know from the constitution but also the federal vacancies act shows the president does have the right to determine who should oversee the agency.

BAIER: There was also, A.B., questions about the constitutionality of the CFPB to begin with, whether the agency itself was set up in a way that was -- adhered to the constitution.

A.B. STODDARD, REAL CLEAR POLITICS: Right. It is sort of unaccountable and without oversight. It is -- this is really the complaint of Republicans and critics of the agency that it is unlike any other body. This is a force that needs clear lines drawn, clear boundaries, definitions. But Jonathan is right to the extent that it's such a needless drama because ultimately President Trump will get exactly who he wants in the position. And it was just going to be an acting job anyway. And so in that regard, it's kind of a meaningless chaos with doughnuts and a lot of excitement and a court ruling.

SWAN: I must say the ideological fight is super important, the actual flight over the substance. The interim role, I was pointing out how crazy it is when you have this interim role with the foregone conclusion, Trump gets his guy, and you have lawsuits flying as the first --

HEMINGWAY: But for an agency like this, though, every month you can keep it in disarray is a win for the agency as it has currently been conceived. And the stunt by Rob Codray actually might backfire --

BAIER: Richard Cordray.

HEMINGWAY: Richard Cordray, sorry, not the comedian, might backfire because Republicans have been wanting to have an avenue to go after this agency and kind of rein it back in. It is not currently funded by Congress but by the Federal Reserve. They should probably -- Congress should think about what it can do to rein in its scope, get its funding under control, and maybe eliminate it altogether.

BAIER: OK, the previous head of this agency was Elizabeth Warren who went on to of course become a senator in Massachusetts. Her name was used today, the name that President Trump calls her, during an event with Native Americans.


PRESIDENT DONALD TRUMP: You were here long before any of us were here, although we have a representative in Congress who they say was here a long time ago. They call her Pocahontas.

SEN. ELIZABETH WARREN, D-MASS.: It is deeply unfortunate that the president of the United States cannot even make it through a ceremony honoring these heroes without having to throw out a racial slur.

SANDERS: I think what most people find offensive is Senator Warren lying about her heritage to advance her career.


BAIER: The Navajo Nation released a statement tonight, saying "In this day and age, all tribal nations are still battling sensitive references to our people. The prejudice that Native American people face is an unfortunate historical legacy. As Native Americans we are proud people who have taking care of this land long before there was a United States of America. We will continue to fight for this nation." However, going on to say that they didn't want to get in the middle of any political back and forth between Senator Warrant and President Trump. This got a lot of coverage today, like a lot of coverage, and obviously the president knew that was going to happen.

SWAN: Yes, he can't help himself. And obviously I'm not going to add to the commentary that there's been a lot of handwringing over this, and perhaps it's justified. From his point of view one of his great pleasures in life is branding people, and this is probably one of his proudest, in his mind, I'm not saying it should be, but in his mind one of his proudest nicknames right up there with Lying Ted.

HEMINGWAY: Has it been explained that the reason why this --

SWAN: She claimed to --

HEMINGWAY: She claimed that she had Native American heritage that she didn't actually have at Harvard and other schools that she was at, proudly said that she had that. She's never really given a good answer for how she came to be doing this falsely.

BAIER: Sure, at that event and in front of the portrait of Andrew Jackson.

HEMINGWAY: Maybe not great.

BAIER: I want to turn quickly to taxes, A.B. This is a kind of montage of the sound on tax reform today.


TRUMP: We are going to be bring them back into this country probably in excess of $4 trillion, $4 trillion, which will immediately be put to work in this country. So I think the tax bill is doing very well and I think the Republicans are going to be very proud of it.

SEN. ORRIN HATCH, R-UTAH: I'm known for somebody for bringing both sides together, so we don't want to ignore our Democrat friends as well. I just hope that they will get off their duffs and start working with us rather than just voting in block against everything we try and come up with.

SEN. PAT TOOMEY, R-PA.: It's going to be tax relief for hardworking, middle income, and lower income families. That's definite.

SEN. TIM SCOTT, R-S.C.: The good news is we are making progress.


BAIER: Continued to sing from the same sheet of music, A.B., but there are some ripples in the water.

STODDARD: No one's going to be happy and comfortable until they have John McCain who they basically have written off, Senator Johnson, Senator Gaines, Senator Moran, Senator Corker, Senator Collins, Senator Johnson, all these people, Flake, all these people say yes and on board. There are seven or eight outstanding in question right now. That's not going to go get you there.

BAIER: They're in different stages of maybe.

STODDARD: Right, so until there is clarity, nobody should be happy. Senator Hatch, the Finance Committee Chairman, also said later on after trying to blame this on Democrats who have been shut out of the process from the start, this is really, really going to be tough. And it is because they just don't have the votes.

The other thing is they are challenging themselves to another very difficult sort of corner, which is do not ultimately have a conference with the House. Basically they want to pass something by the end of the week that they can send back to the House and have the house OK because they can't handle a conference committee. There are so many provisions the Senate has that the House won't accept. So it's not that we will get a bill out of the Senate this week. The question is will there be a tax reform bill.

SWAN: I just did a huge run of calls with sources. They're genuinely concerned. And tomorrow there's a budget vote which is kind of a proxy for this. They will be watching Corker and Johnson. They are not there yet, and they are worried. It's just a fact. They don't have the votes yet. Whether they will or not, I still lean in the yes category because a lot of people want to get the yes. They were drawing big, bright red lines in health care that they're not drawing now, but the fact is they don't have the votes.

BAIER: And it's all about counting.

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