The Rise of DOGE: What’s Happening Now?
The latest move by the Trump administration has sent shockwaves through the financial regulatory landscape. The recently established Department of Government Efficiency (DOGE) has set its sights on eliminating—or at least significantly reducing—the Consumer Financial Protection Bureau (CFPB). While marketed as a way to cut red tape and streamline government oversight, this shift raises critical concerns about consumer financial protection in the United States.
DOGE’s agenda aligns with broader deregulatory efforts, arguing that the CFPB's oversight hinders financial institutions and restricts economic growth. However, history has shown that a lack of consumer protection often leads to predatory lending, increased fraud, and financial instability.
As DOGE advances its plans, what steps can individuals or support organizations take to maintain the efforts where the CFPB is stepping back? Read on to learn how financial education, decision-making, and personal accountability are becoming more crucial than ever.
About the Author: Jeff Hulett leads Personal Finance Reimagined, a decision-making and financial education platform. He teaches personal finance at James Madison University and provides personal finance seminars. Check out his book -- Making Choices, Making Money: Your Guide to Making Confident Financial Decisions.
Jeff is a career banker, data scientist, behavioral economist, and choice architect. Jeff has held banking and consulting leadership roles at Wells Fargo, Citibank, KPMG, and IBM.
The CFPB’s Role and the Risk of Enforcement Gaps
Since its creation in 2010, the CFPB has been at the forefront of consumer financial protection, regulating everything from mortgage lending to credit card practices. In response to the 2008-2009 financial crisis, the United States saw a 20x increase in consumer protection laws, aiming to prevent the abuses that led to widespread economic collapse. **
However, having laws on the books does not guarantee enforcement. Selective enforcement by the executive branch has become a troubling norm in recent decades. This "rule by refusal" approach makes it easier to weaken legal protections without officially passing legislation to change them. Keep in mind that the Trump administration is not changing the heightened consumer financial protection federal laws passed by Congress, they are simply decreasing enforcement of those legal protections. Which, effectively makes the executive branch the legislative branch. Troubling indeed.
Can other regulatory agencies pick up the slack? History says "No."
The CFPB’s singular focus on consumer financial protection ensures accountability and oversight in ways that broader regulatory agencies—such as the Office of the Comptroller of the Currency (OCC), the Federal Deposit Insurance Corporation (FDIC), the Federal Reserve, and the National Credit Union Administration (NCUA)—simply cannot match. Additionally, the states share the responsibility for bank regulation, which includes consumer protection.
If the CFPB is eliminated or significantly weakened, an enforcement gap will emerge. While other federal regulators may attempt to fill the void, their mandates are broader, and consumer protection is not their primary focus. State enforcement is variable. A few states, such as New York, are generally more proactive, while the majority are not. This leaves consumers vulnerable to predatory financial practices with little recourse.
The consumer vulnerability logic is inescapable. The other regulatory agencies were "in charge" before the 2008-09 financial crisis. The disastrous results of that crisis clearly demonstrated a gaping hole in the consumer protection regulatory regime. Today, the consumer financial protection legal corpus is 20x that before the crisis. If these legacy regulators could not do their consumer protection job before, what reasonable person would expect the same regulators to step in with a 20x increase in complexity? This is NOT a knock against the legacy regulators, consumer protection as required by law is an unreasonable ask of them. The safety and soundness focus necessary for the legacy regulators creates natural conflicts for consumer protection.
Some argue that consumers can always sue financial institutions if they experience harm, but this assumption presents serious challenges. Often, financial harm does not become evident until years later, making redress too late to be meaningful. Additionally, banks, with their legal sophistication, are adept at quashing individual claims, while many consumers lack the knowledge or resources to initiate lawsuits and may even distrust the legal system more than the financial institutions they seek to challenge.
Is iron-clad consumer financial protection even a realistic goal?
Probably not. Even if the CFPB remained unchanged, expecting financial institutions to disclose every detail of a complex financial product tailored to your specific decision motivations is unrealistic. Ensuring that you make an informed decision in full compliance with consumer protection law ultimately requires personal diligence, financial literacy, and a robust decision process. All financial services companies provide information disclosures. Conceptually, the idea is that this product information is needed for anyone to make an informed decision. This is wrong for a couple of reasons:
As a regulatory accepted practice, legally required information disclosures are written in dense legal jargon. Lawyers craft the disclosures in a manner that makes them difficult for normal people to understand.
But imagine for a moment you could wave a magic wand and all disclosures were written more intuitively. Relying on those disclosures is likely not enough. These disclosures seek to minimally comply with the "one size fits all" letter of the law, not with your nuanced and unique "many sizes fits many" circumstance.
A more reasonable consumer attitude is that financial products are complex. A consumer needs to 'fight fire with fire' by deploying an informed decision process and their decision-making judgment to truly understand the financial product in a way that helps them make the best decision.
Mortgage disclosure packages are a case in point. Today they are large, often more than 100 dense pages. An entire "sign here, sticky note" technology industry has emerged to help consumers avoid reading the disclosures! As such, regardless of the varying enforcement profile of the most recent administration, taking charge of your own financial decisions is essential to achieving long-term wealth.
The Increasing Need for Financial Education and Decision-Making
With diminished government oversight, individuals must take greater responsibility for their financial well-being. However, most Americans lack the financial education necessary to navigate a deregulated environment. Schools rarely teach decision-making for personal finance success. When personal finance is taught, it often focuses on outdated methods, training students to memorize financial product details. This is reminiscent of a scene from the movie "Hidden Figures," set in the 1960s when individuals actually worked as detail-generating human calculators. But today, we have apps and GenAI that can instantly generate accurate product details—rendering memorization unnecessary. The true challenge is no longer exhausting our fixed mental capacity by pursuing financial information. In our modern world, our challenge is effectively partnering with Gen AI and related resources to decide how to make decisions with that abundant information.
Decision-making is the essential skill in the data-abundant information age. The overwhelming amount of available information, much of it irrelevant and occasionally incorrect, makes choosing wisely more difficult. Cognitive biases further distort financial decision-making, leading to costly mistakes. The significant information age challenge is weighing abundant information, not finding scarce information. Cognitive biases are like an invisible hand inappropriately tipping your weight scale. Individuals will struggle to make informed choices without proper training, practice, and structured decision tools tailored to their unique needs. To achieve financial success, people must move beyond merely memorizing product details and instead focus on clarifying what truly matters to them—then applying a robust decision-making process to evaluate, validate, and act on that information.
This makes the right kind of financial education more important than ever. In a world where consumers can no longer rely on government intervention to prevent deceptive practices, individuals must become their own advocates. Understanding decision-making processes, data curation, and financial strategies will be essential for implementing those apps, avoiding bad financial decisions, and ensuring long-term stability.
Personal Finance Reimagined (PFR): A Solution for Self-Protection
Enter Personal Finance Reimagined (PFR)—a comprehensive platform designed to help individuals and organizations develop a consistent, repeatable process for making sound financial decisions. When government protections weaken, financial literacy and disciplined decision-making become the most reliable safeguards against financial exploitation. PFR provides the tools, resources, and guidance necessary to empower individuals in an increasingly deregulated environment.
PFR’s Approach to Financial Education
PFR is not just another financial literacy program; it is a structured approach to lifelong financial decision-making. The platform serves decision-makers and financial learners via several channels:
University Programs: Helping students build a financial decision-making framework before entering the workforce.
Startups and Entrepreneurs: Equipping business owners with the knowledge to make sound financial choices in a volatile marketplace.
Accountant Clients: Enhancing advisory services with structured financial education for small to midsize businesses and entrepreneurial clients.
Wealth Management Clients: Supporting long-term financial planning and decision-making, especially for their client's children.
Nonprofits: Providing financial literacy training to underserved communities.
High Schools: Teaching young adults the principles of responsible financial management via sound college decision-making.
Employee Benefits Programs: Offering financial decision-making tools to improve workplace financial wellness.
Tools That Make a Difference
PFR provides an array of tools to support its mission:
Books: Including Making Choices, Making Money, which serves as a guide to building financial confidence.
Apps: Such as Definitive Choice, a decision-making tool that helps individuals evaluate financial options systematically.
Videos and Online Content: Offering accessible, engaging education on financial topics.
Teaching and Seminars: Led by financial decision-making experts to provide hands-on learning experiences.
One-on-one Coaching: Providing personalized financial and decision-making guidance tailored to individual needs.
The Bottom Line: Protect Yourself Before It’s Too Late
With the possible elimination of the CFPB, the responsibility for financial protection is shifting from the government to the individual. This is both a challenge and an opportunity—while consumers may face increased risks, they also have the power to take control of their financial futures through education and proactive decision-making.
Organizations like PFR provide the necessary support to navigate this changing landscape. By building a strong foundation in financial literacy and decision-making, individuals can protect themselves from predatory practices, make informed choices, and ultimately achieve financial security.
The days of relying on government oversight to safeguard financial interests may be numbered. Now is the time to invest in financial education, develop a structured approach to financial decision-making, and take control of your financial future. Don’t get caught off guard—get educated, get prepared, and make sure you don’t get DOGE’d.
Resources for the Curious
Decision-making and personal finance:
Personal Finance Reimagined. Personal Finance Reimagined and the Secret to Financial Success. YouTube, 3 Mar. 2024, https://www.youtube.com/@jeffhulett.
Data Curation:
Hulett, Jeff. From Confusion to Clarity: The Science and Art of Filtering Noise and Making Confident Choices. The Curiosity Vine, August 30, 2023.
Investment Framework and Apps:
Hulett, Jeff. Making Choices, Making Money: Your Guide to Making Confident Financial Decisions. Independently published, 2023. ISBN: 9798391907466.
In summary, the word count of banking laws increased from tens of thousands of words before the financial crisis to several hundred thousand words after the crisis. This is based on an analysis of data from:
Ross, Major Regulations Following the 2008 Financial Crisis, Investopedia, accessed 2024
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