Senator Elizabeth Warren said that President Donald Trump’s moves to dramatically cut federal regulatory agencies would leave consumers and markets vulnerable to fraud and corruption, magnifying vulnerabilities to a financial system already beset by uncertainty in the face of the White House’s tariffs.
“Trump at every turn is trying to put deregulators in place across the whole financial services space, and that is really dangerous,” Warren, a Massachusetts Democrat who helped create the Consumer Financial Protection Bureau, said in an interview with Bloomberg News.
Warren spoke as the Trump administration moved to implement mass layoffs at the CFPB on Thursday. A legal filing by the union representing the consumer bureau’s staff estimated that some 1,500 of the CFPB’s 1,700 staff could be fired.
At the Securities and Exchange Commission, about 500 employees have taken deferred resignation and buyout offers as part of the president’s efforts to downsize the federal workforce. The SEC has already dropped a number of high-profile enforcement cases related to cryptocurrency and deferred or eliminated rules implemented during the Biden Administration.
“Now the cops are gone,” Warren said.
Trump and senior officials have argued his efforts to reduce the size and scope of the federal government are eliminating wasteful spending that contributes to the nation’s deficits and removing regulations that slow economic growth.
The CFPB, in particular, has long been a target of Republicans who have accused the agency of overstepping its authority and imposing burdensome regulations.
Trump’s administration, in an effort led by billionaire adviser Elon Musk’s Department of Government Efficiency and Office of Management and Budget chief Russ Vought, have begun to dramatically dismantle the agency, suspending its work overseeing financial companies and shuttering its Washington DC headquarters. The DOGE team’s actions at agencies across the government have sparked a wave of lawsuits, including over efforts to dismiss CFPB’s staff and access its computer systems.
Warren, for her part, cast the moves as part of a series of rash presidential actions — along with Trump’s sweeping tariff announcement and subsequent partial reversal, threats to remove the tax-exempt status of universities and nonprofit groups seen as political enemies, and public criticism of Federal Reserve Chairman Jerome Powell — that are seeding uncertainty across the economy.
Trump on Thursday said Powell has been a “terrible” leader of the Federal Reserve, arguing the central bank was “too slow” to cut rates that the president said would reduce inflation and offset the economic impact of his tariffs.
“I don’t think he’s doing the job,” Trump said. “He’s too late — always too late. A little slow. And I’m not happy with him. I let him know it.”
On Friday, National Economic Council Director Kevin Hassett told reporters Trump is studying whether firing Powell is an option.
The cumulative “cost of chaos,” Warren said, had left businesses in turmoil and contributed to “flashing red” warning signals that economic calamity could be nearing. The uncertainty, she argued, was also contributing to turbulence in the bond market that suggested the US could be losing its status as the premier safe harbor in tumultuous times.
“We’re already paying a huge price for every hour that goes by that he gets out there and rattles his sabers about firing the chairman of the Fed,” Warren said. “Whatever the next thing he picks up is another cost and another blow and pushing the economy closer into recession that we just may not be able to reel back.”
The University of Michigan’s consumer confidence released last week showed a 30% drop since December, while inflation expectations have surged to the highest level since 1981.
“At the grassroots level, the weather is changing fast,” Warren said. “It’s farmers in Iowa and factory workers in Pennsylvania and researchers in California who are all saying, I may have voted for Donald Trump or not. But this has to stop.”
This article was generated from an automated news agency feed without modifications to text.
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