Trump and Congress Just Made it Easier for Auto Lenders to Discriminate Against People of Color

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You know who has it really hard these days? Banks and car dealers who want to discriminate against their customers. Luckily, the little guys (who, to be clear, are banks and car dealers, and definitely not the people they’re discriminating against) finally have politicians willing to fight for them: President Donald Trump and Congressional Republicans.


Trump signed legislation today repealing a 2013 guidance issued by the Consumer Financial Protection Bureau (then headed by now-Ohio gubernatorial candidate Richard Cordray) that was meant to discourage auto lenders from marking up interest rates. A 2015 study by the National Consumer Law Center found that black car owners were often being charged hundreds of dollars more on these markups than white owners, and the same year, Honda reached a $25 million settlement with Obama’s Justice Department for overcharging black, Latinx, and Asian and Pacific Islander borrowers.

The bill was passed by the Senate in April with the support of Republicans and Democrat Joe Manchin of West Virginia, and in the House earlier this month with the support of every Republican except one, plus eleven conservative House Democrats. As Politico noted, the new law is the first time Congress has used the Congressional Review Act to kill a regulation that was made several years ago; usually, they only get a 60 day window, but because this was a guidance document rather than a formal regulation, it took five years to determine whether or not it was a “rule” subject to Congressional oversight.

The consumer watchdog group Allied Progress sharply criticized the new law. “Many auto dealers are actively discriminating against people of color,” executive director Karl Frisch said in a statement. “Unfortunately, this President and his Congress are working overtime to repeal efforts aimed at ending discrimination in the financial marketplace.”

“Trump is making a calculated appeal to the very people who benefit from today’s action: auto lenders who will make more money through their discrimination and his political base which delights in his downright hostility toward communities of color,” Frisch added.