Gorsuch and Alito diverge from conservative stance in CFPB ruling

In a surprising turn of events, two of the Supreme Court’s most conservative justices, Samuel Alito and Neil Gorsuch, dissented from the majority opinion in a 7-2 vote upholding the constitutionality of the Consumer Financial Protection Bureau’s (CFPB) funding mechanism. The decision, led by Justice Clarence Thomas and joined by Chief Justice John Roberts, conservative Justices Brett Kavanaugh and Amy Coney Barrett, as well as the three liberal justices, upheld the agency’s unique funding structure.

Alito and Gorsuch argued that the decision undermines Congress’s power of the purse by allowing the CFPB to bankroll its own agenda without sufficient oversight. They criticized the agency’s ability to draw funds from the Federal Reserve System without annual appropriations, a mechanism that has long been a target of Republican attacks.

Justice Thomas, in the majority opinion, refuted these arguments, stating that the CFPB’s funding mechanism does not violate the Appropriations Clause. He directly addressed the dissenting justices’ concerns and highlighted the historical evidence supporting the majority’s interpretation of “appropriations.”

The decision marks the end of a significant legal battle that posed a major threat to the CFPB, established in the aftermath of the 2008 financial crisis to protect consumers from predatory lending practices. The challenge to the agency’s funding mechanism was brought by lender trade associations and supported by Republican state attorneys general.

The Supreme Court’s ruling not only upholds the CFPB’s funding structure but also highlights the divisions among the justices on the nation’s highest court, with unexpected alliances forming in this crucial decision.