ARLINGTON, Va. As he prepares to exit the credit union movement to retirement in North Carolina, Fred Becker, who has led NAFCU for 13 years, worries about a number of trends in Washington, but none more than the growing reach of independent agencies such as NCUA that have few restrictions by the president, by Congress, or taxpayers a so-called fourth branch of government.
“No longer are there three branches of government,” said Becker, alluding to the traditional notion that the presidency, Congress and the judiciary are the mainstays of the federal system. “There is a fourth branch made up of all the independent regulatory agencies.”
He points to a recent study that said the fourth branch now has a larger practical impact on the lives of citizens than all the other branches combined. It further stated the vast majority of “laws” are not passed by Congress, but are issued as regulations created by thousands of faceless bureaucrats. One study found that in 2007, Congress enacted 138 public laws, while federal agencies finalized 2,926 rules, including 61 major regulations. In many cases, a citizen is much more likely to be tried by an administrative panel at an agency than by an actual court.
The 64-year-old Becker says he is cancer-free after the removal of his bladder and creation of an artificial bladder from his small intestine. He is retiring after developing NAFCU into a reliable player on Capitol Hill, taking the group to the next level from his predecessor, the revered Ken Robinson, and leaving it in the capable hands of his chief lobbyist and successor as CEO, Dan Berger.
During his time at NAFCU, Becker has regularly cautioned about the growing independence of NCUA, one of dozens of self-funded federal agencies that are empowered to raise and spend their own money with little congressional oversight. In NCUA’s case, notes Becker, the agency has the equivalent of taxing power by setting the annual fees assessed federal credit unions without any say by Congress or credit unions. The regulator sets dozens of new rules a year with little notice from Congress. NCUA even told Congress recently it is not bound by a presidential directive applying to all federal agencies that would have barred outside law firms from being hired on a contingency basis in the corporate law suits.
Its independent status also has saved NCUA from the government-wide budget sequestration that has reduced spending at all but the independent agencies.
Becker worries that NCUA is going to use a similar justification when deciding whether to spend $13 million of credit unions’ money on employee pay raises that have not and probably will not be approved by Congress, even though a contract with the agency’s employees’ union makes the pay raises contingent on congressional action for the rest of the government. “You watch, they’ll find a way,” said Becker in an interview with Credit Union Journal in his office Friday.
Now Becker worries about the growth of another independent agency, the Consumer Financial Protection Bureau, which ostensibly is a unit of the Treasury Department and does not rely on Congress for its funding. The CFPB already has enacted or amended dozens of regulations, even as Congress is stalemated in its least productive session on record.
Other independent agencies include the FDIC, the Federal Reserve, Securities and Exchange Commission, Commodity Futures Trading Commission, Federal Election Commission, Federal Energy Regulatory Commission, Federal Trade Commission, National Labor Relations Board, Nuclear Regulatory Commission, Social Security Administration, U.S. Postal Service, Small Business Administration, EPA and CIA.
The growth of the fourth branch, according to Becker, comes at the expense of accountability to the public, to taxpayers, to Congress and even to the president, who in most cases appointed the agency heads and boards, such as at NCUA. “Congress can’t overrule them,” he said. “They literally have unfettered ability to do what they want to do.”
