Sen. Elizabeth Warren presses R. Alexander Acosta on Department of Labor’s fiduciary rule

Sen. Elizabeth Warren, D-Mass., has sent R. Alexander Acosta, the Trump administration’s nominee for Secretary of Labor, a 23-page letter pressing him for details on his views on the Department of Labor’s fiduciary rule as well as other matters.

Sen. Warren expressed her displeasure with either a delay in implementing the DOL fiduciary rule or rolling it back. “Given the positive changes in the market … and the most recent estimate from the Economic Policy Institute, any efforts to roll back these new protections will be devastating to consumers,” she wrote in the March 21, 2017 letter to Mr. Acosta.

The liberal Economic Policy Institute estimated that a 60-day delay in implementing the fiduciary rule would cost Americans saving for their retirement $3.7 billion dollars over their lifetimes.

President Trump, in a Feb. 3 memorandum, required the DOL to conduct a new cost-benefit analysis of the fiduciary rule. The DOL had previously compiled a 382-page cost-benefit analysis before the rule was approved. The new analysis could result in changes to the rule or its elimination.

Among the questions for Mr. Acosta:

• What information will you review as part of this assessment? Will you commit to only reviewing information that is independent and is not funded or otherwise compromised by financial industry players with a vested interest in the findings?
• Do you have any reason to believe that the findings of the new analysis will be any different from the detailed, multi-year analysis of the costs and benefits of the rule that was already conducted by DOL before the proposed rule was issued or in the extensive Regulatory Impact Analysis that was issued at the time the rule was finalized? If so, why?
• Will you refrain from taking any additional action to delay or limit the rule until your analysis is complete? Will you inform Congress on an ongoing basis of the status of your efforts?

Sen. Warren’s letter also pointed out potential conflicts of interest between Mr. Acosta and President Trump’s businesses and asked questions about Mr. Acosta’s intentions to enforce wage and hour laws.

Sen. Warren had sent a similar 28-page letter to Andrew Puzder, President Trump’s nominee for labor secretary, on Feb. 13. Mr. Puzder, chief executive officer of CKE Restaurants, the parent company of Hardee’s and Carl’s Jr., withdrew from consideration for the DOL position on Feb. 15, amid Democratic opposition to his business record and Republican concern about his employment of an undocumented immigrant housekeeper.

Whether Sen. Warren’s letter will help save the fiduciary rule, originally slated to take effect April 10, is unclear. “It sure looks like the Trump administration is looking to swiftly undo the rule,” said Mark Maddox, managing partner at Maddox Hargett & Caruso and former Indiana securities commissioner. The delay and cost-benefit analysis “sounds like an invitation to drum up evidence for finding the harm the rule will do,” he said.

Republicans rule the House, Senate and the executive branch of the government.

“It’s just a rule,” Mr. Maddox said. “I just anticipate a complete dismantling of it. Sen. Warren is one of its biggest advocates, but she won’t be able to do anything with a Republican president and his appointees. They won’t care how many letters come in.”