The disarray at the CFPB is what you get when the executive branch exceeds its constitutionally specified mission

The basics of the situation are that the Bureau's head, Richard Cordray, rather abruptly announced that he'd be stepping down as of the end of the business day on Friday, and Trump appointed Mick Mulvaney to take his place on an interim basis. He'd be handling those duties in addition to continuing as budget director. Alas, Cordray's immediate underling, Leandra English sees the situation otherwise and is suing to keep Mulvaney from assuming the position.

Ronald Rubin at NRO provides the important backstory on Cordray:

Ambitious, cerebral, and socially awkward, Cordray had alternated between stints as an accomplished lawyer and a mediocre politician before he lost Ohio’s attorney-general election in 2010 and Elizabeth Warren, then a presidential assistant, hired him to lead the nascent bureau’s enforcement division. The following July, President Obama bypassed Warren and instead nominated Cordray to be the CFPB’s first director. In the marathon standoff that ensued, Republican senators filibustered the nomination, Obama installed Cordray by using an unconstitutional recess appointment, Democrats threatened to change the filibuster rules, and Republicans surrendered. On July 16, 2013, the Senate confirmed the temporary director to a five-year term.

Perhaps it was this two-year ordeal that turned Cordray into a cynical partisan mercenary. The University of Chicago Law School graduate understood the harm that anti-market policies cause consumers, but whenever newly elected Senator Warren and progressive groups pressured him to pursue their agenda, he faithfully delivered.

By 2017, there was no denying the ugly truth. Cordray cared about consumers, but he was consumed by politics. Since 2010, Republicans have argued that the CFPB’s unique structure — an independent agency whose single director the president can fire only for cause, with guaranteed funding through Federal Reserve Bank profits rather than the congressional appropriation process — is a recipe for government abuse, if not unconstitutional. Cordray proved them right.

Warren built a political battleship, and Cordray deployed it. The bureau’s powerful media division dictated policy to its regulatory professionals and relentlessly exaggerated the agency’s achievements in daily press releases and social-media posts. Political operatives used the CFPB’s super-independence to stonewall congressional subpoenas and hide unethical investigation tactics, internal discrimination problems, and other inconvenient facts. Republican critics were dismissed as Wall Street sycophants.

Meanwhile, millions of dollars were diverted from the CFPB to Democratic allies. From 2014 to 2017, the bureau paid $11 million a year to rent office space in an Obama fundraiser’s building. The Dodd-Frank Act allowed the CFPB to send the civil money penalties collected in its enforcement actions to a trustee of its choice, who, after taking a healthy cut, distributed the funds to ostensible victims in unrelated matters. The maneuver both enriched Democratic trustees and transformed fines extracted from defenseless businesses based on their deep pockets rather than actual consumer harm into “over $12 billion in damages returned to 29 million injured consumers.” To spread such propaganda, the bureau paid over $43 million to GMMB, the liberal advocacy group that created ads for the Obama and Hillary Clinton presidential campaigns.

The 2016 election almost ended Cordray’s tenure. Despite high-profile litigation and debate over what, if any, justification the new Republican president needed to fire him, the legal remedy for unwarranted removal would probably have been back pay, not reinstatement. Cordray survived only because the president’s advisers felt that making the director a martyr would help his expected Ohio gubernatorial campaign. They underestimated him.

Cordray spent the first half of 2017 quietly promoting and entrenching faithful Democratic employees to obstruct his Republican successor. On June 30, he awarded GMMB an additional $14.79 million contract. Ten days later, he delivered a gift to big Democratic donors in the plaintiff’s bar: a rule banning financial businesses from using contractual arbitration clauses to prevent consumers from joining class-action lawsuits. Cordray argued that the lawsuits were necessary to prevent deceptive practices because individuals rarely sue over improper bank fees and other small damages. Of course, the CFPB was created to prosecute such violations, but he said that limited resources prevented it from sufficiently protecting consumers. He then unveiled a video titled “CFPB’s New Arbitration Rule: Take Action Together,” an expensive GMMB creation reminiscent of Clinton’s “Stronger Together” ads. Republicans were forced to use the Congressional Review Act to block the rule; Democrats gained a talking point for the midterm elections. 

Joe Cunningham at Red State explains that such partisan hackery is now coming back to bite the Dems:

Here’s what happened, in a nutshell: The Democrats thought they had a permanent majority, and so they allowed Obama to consolidate this power. They created the CFPB as a means of allowing a Democratic president to regulate the financial sector without legislative oversight. They allowed unrestrained executive power over many U.S. agencies without a care as to what would happen if a Republican took over as President of the United States.

They thought that idea was laughable.

Well, here we are. We have President Trump with unfettered power across many executive agencies, including the CFPB. At best, we’ll get an argument about recess appointments, maybe, but Trump has the legal authority here, unless a court says different.

And, if a court does say that Trump doesn’t have the legal authority to make this appointment, then the Trump administration just has to point back to the D.C. Circuit’s opinion that the entire agency is unconstitutional anyway and ask Congress to cut its funding.

The Democrats have backed themselves into a corner here, not realizing that the Republicans could and would take the highest office in the land and use it to wield influence over the same agencies they were fine with their own president wielding influence over. 

When you take a wild-west approach to government rather than follow what the Constitution says about the specified functions of each branch, you are a fool for assuming that you'll always have an advantage over your adversaries. And the more loosey-goosey the "independent-agency" designation, the less sure you can be about things turning out as you intended.