Most Americans have probably not heard of the Consumer Financial Protection Bureau (CFPB), but when this powerful new government agency opens its doors in July, the CFPB could have a significant impact on their daily lives. The bureau was created in 2010 as part of the so-called financial reform legislation, the Dodd-Frank Act. And there are real concerns that without appropriate oversight, the CFPB’s reach could expand well beyond those areas in need of immediate reform. From debit cards to auto loans, overregulation by the CFPB would heap additional burdens and costs onto personal financial products, and restrict access to credit for consumers and small businesses – the very entities the agency is charged with protecting.

On May 5, 2011, I joined 43 of my Senate colleagues in asking President Obama to work with us in reforming the CFPB to make certain it is both effective and accountable. As of today, we have received no official response from the Administration, but have heard plenty of rhetoric from opponents about our commonsense approach.

Let me be clear about what my colleagues and I asked the President to consider. First, we asked for the CFPB’s single Director to be replaced with a multi-member Board or Commission appointed by the President. This structure was a part of the President’s own initial design for the agency and was included in the House-passed financial reform bill, specifically written into the text by then-Chairmen Barney Frank and Henry Waxman. Working without Republican input, the Democrats’ language was removed in conference and replaced with a single director. Allowing a single unelected bureaucrat to define their own jurisdiction and regulate vast segments of our economy without accountability or restraint is a “reform” that should be rejected.

Second, we asked that the CFPB present an annual request to Congress for funding, just like dozens of other government agencies do each year. The appropriations process remains one of the most time-tested methods for monitoring the effectiveness of government agencies – and holding them accountable to the American taxpayer. The CFPB has more power and authority than almost any independent agency in history; asking them to present a budget to Congress for approval is a modest request. 

Finally, we asked the President to work with us to ensure that prudential banking regulators, who oversee the safety and soundness of financial institutions, have meaningful input into the operations of the CFPB. This critical change would prevent dramatic restrictions in credit and protect community banks from overregulation. In Kansas, this is especially important for small businesses that need loans from their community banks to make payroll, as well as farmers and ranchers who need operating loans to fund operations through harvest.

I have drafted legislation that would enact these simple, yet vital reforms – reforms that have previously garnered support from Democrats and Republicans alike. Now certain groups are claiming our plan would dramatically weaken the CFPB before its birth. Others allege Republicans are doing Wall Street’s bidding, trying to gut the CFPB of its power in a “dark alley,” far from public view. This is simply empty rhetoric. 

The reality is community banks and small businesses on Main Street are the most likely beneficiaries of the balanced approach we are proposing. They are also the most likely victims of overregulation if we fail to get this right.

Some say our three requests have given President Obama a path to recess appoint the first Director of the CFPB. I have found no historical precedent for a recess appointment to a new agency of the CFPB’s size and scope – and since the President has already chosen to wait more than 10 months to nominate a Director, why not wait another few weeks and give Congress the oversight authority required for such a powerful agency?

Rather than delegitimize the CFPB at its inception, the Administration should focus its energy on working with Congress to enact the basic reforms needed to truly protect consumers. Given its incredible power over Main Street, it is Washington’s responsibility to make certain we get the design of the powerful new CFPB right before it opens for business.

Senator Moran is a member of the Senate Committee on Banking, Housing and Urban Affairs.