【how long does it take for lavender to germinate】Why Consumer Financial Protection Bureau's structure is a real threat to small business, individual liberty
发布时间：2024-09-29 08:13:45 来源：laurann dohner new species book 16 release date 作者：Leisure
Thehow long does it take for lavender to germinate DNA of our Constitution, through defined separation of powers between three, co-equal branches of
government
, reflects a deep skepticism of centralized power. Often these three branches are in friction with each other, each defending their institutional interests. But the ultimate decider is “We the People.”
A
government
that is accountable to the people, rather than enshrined in one single person or entity, remains a source of pride and identity to most Americans.
CFPB STRUCTURE CHALLENGED IN SUPREME COURT PETITION FILED BY PAYDAY LENDER
Like all Americans, small businesses are chromosomes critical to the “makeup” of America’s DNA and comprised of people wanting to simply create and run a business on their own terms. They are leery of unchecked
government power
that inevitably leads to more federal regulation.
Along those lines, my organization, the NFIB Small Business Legal Center filed a brief with the Supreme Court arguing that the current structure of the Consumer Financial Protection Bureau (CFPB) violates the separation of powers as set forth in the Constitution and, consequently, represents a grave threat to individual liberty and the interests of the small business community.
CONSUMER FINANCIAL WATCHDOG ABANDONS NAME CHANGE PLAN
In 2010, during the height of the Great Recession, then-President Barrack Obama signed into law a controversial set of economic reforms aimed at reining-in Wall Street. The statute, known as Dodd-Frank, established a centralized federal agency, vested with broad authority to regulate business in the name of "consumer protection." To that end, Congress gave unprecedented powers – authority to implement and enforce 19 consumer protection laws -- to the newly created CFPB.
Like other so-called “independent agencies” (e.g, the Federal Communications Commission (FCC) or the National Labor and Relations Board (NLRB)), the CFPB is distinct from traditional executive branch agencies. Federal agencies are usually run by a presidentially appointed official who is accountable to the president. Independent agencies are unaccountable because their governing officers -- typically governed by a board or commission comprised of appointees from both political parties -- cannot be removed once installed.
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But the CFPB is different. Its power resides in one person – a single director charged with implementing and enforcing 19 laws and accountable to no one. In fact, the CFPB – unlike any other agency “independent” or otherwise – isn’t even required to go to Congress for the money it needs to operate. Rather, it generally receives its funding through the Federal Reserve.
Story continues
On March 3, the Supreme Court of the United States will hear arguments in Seila Law LLC v. CFPB. The case concerns whether the CFPB is structured in a way that violates the separation of powers in the Constitution by ceding the implementation and enforcement authority of nearly two dozen laws to a single director.
While the Supreme Court generally has upheld the constitutionality of independent agencies over the years, the CFPB is another matter.
In 2016, Brett Kavanaugh, then sitting as a judge on the D.C. Circuit Federal Court of Appeals, authored a dissent in the case of PHH Corp. v. CFPB. In it, Judge Kavanaugh argued that the CFPB, under a single director, “wields enormous power over American businesses, American consumers, and the entire U.S. economy.”
Although the D.C. Circuit upheld the CFPB as constitutional in its current form, things have changed since then. For one, Brett Kavanaugh has been elevated to the U.S. Supreme Court.
If the U.S. Supreme Court upholds the CFPB’s current structure, the decision will invite Congress to create new “independent agencies” with czars calling all the shots. Such a regulatory regime would result in a government unaccountable to the people. And that’s not in America’s DNA.
Karen R. Harned is Executive Director of the National Federation of Independent Business Small Business Legal Center.
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- 5%, led by a 17% increase in average ticket and a slight decline in traffic. Growth in the quarter reflected the impact of households stocking up on essentials like paper goods and cleaning supplies as the pandemic became a nationwide concern, along with strength in discretionary categories as the quarter came to a close and stimulus dollars and tax refunds were disbursed.
As shown below, the results in the quarter materially changed the trend in two-year stacked comps for each of the banners, along with a significant acceleration for consolidated comps.
The increase in consolidated comps was the primary driver of an 8% increase in revenues to $6.3 billion. The company ended the quarter with 15,370 locations, up less than 1% year-over-year. This reflects a 7% increase in Dollar Tree units, offset by a 4% decline in Family Dollar units.
The top-line results at each banner flowed through to their respective income statements, with Dollar Tree gross margins and operating margins declining year-over-year while Family Dollar gross margins and operating margins expanded year-over-year. On a consolidated basis, gross margins contracted by 120 basis points in the quarter to 28.5%, reflective of a shift to lower-margin consumables, tariff costs and the impact of markdowns from the Easter headwinds at the Dollar Tree banner. The company saw slight operating leverage on SG&A from higher comps, with the net result being an 80 basis point contraction in operating margins to 5.8%, with operating income declining 5% to $366 million. This is not adjusted for $73 million of pandemic-related costs, such as PPE supplies.
In the first quarter, the company opened 85 stores (net of closures) and completed 220 Family Dollar renovations to the H2 format. Importantly, comps at renovated Family Dollar stores continue to outpace the chain average by more than 10%. On the call, management indicated that they plan on reducing both the number of new store openings (from 550 to 500) and the number of H2 renovations (from 1,250 to 750) in 2020.
Personally, given the fact that Family Dollar is seeing material benefits to its business from the pandemic with new or lapsed customers coming into its stores, I think the company should try to get more aggressive with its renovation plans, not less. On the other hand, you could argue that renovations cause short-term disruptions and limit their ability to fully capitalize on the business momentum they are currently experiencing.
As a result of fewer new stores and remodels, management now expects 2020 capital expenditures to total $1.0 billion compared to previous guidance of $1.2 billion. In addition, the company has temporarily suspended share repurchases. At quarter's end, the company had $1.8 billion in cash on its balance sheet compared to $4.3 billion in total debt.
Conclusion
In recent years, Dollar Tree has been a tale of two cities. While its namesake banner has generally delivered impressive financial results, Family Dollar has been a persistent underperformer. This quarter, those results flipped, and given what we've seen in the weeks since quarter's end, there's a decent possibility that we will see something similar in the coming months. As the CEO noted, the second quarter is off to a very good start at Family Dollar.
Here's the important question: how useful is that information is in terms of making future predictions about the business? Will recent success at Family Dollar translate into long-term success for the banner? The optimistic take is that new or lapsed customers, especially those visiting the renovated stores, could become recurring business for the banner. The pessimistic take is that they have experienced short-term success out of necessity as people went to any store that was open to try and find essentials like toilet paper and hand sanitizer that were largely out of stock throughout the retail landscape. From that view, many of these customers could abandon the retailer when life returns to normal. As Philbin noted on the conference call, early on [during the pandemic], folks needed us. Will people still shop as much at Family Dollar when it's no longer a necessity?
Personally, I do not place too much weight on the recent results. I will need to see incremental data points that indicate that Family Dollar has truly won sustained business from these new customers. While I still believe that the Dollar Tree banner is a well-positioned retailer with attractive unit returns, I'm not yet willing to say the same thing for Family Dollar. For that reason, along with the recent run-up in the stock price, I plan on staying on the sidelines for now.
Disclosure: None
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