President Obama’s decision to nominate former Ohio Attorney General Richard Cordray to serve as the permanent director of the Consumer Financial Protection Bureau less than a week before the agency is set to open its doors did nothing to gin up Obama’s base or make Republicans more eager to capitulate over one of the most polarizing aspects of financial reform.
The announcement on Sunday failed to undo the criticism that the administration wasted time and squandered leverage by waiting so long to nominate someone and perpetuated the expectation that the slot would have to be filled through a controversial recess appointment. Logistically, it is also next to impossible that the Senate would confirm anyone by Thursday when the agency goes into effect, so the timing of the announcement is more a symbolic acknowledgment of the one-year anniversary of the Dodd-Frank financial reform law than the beginning of a practical strategy to put it fully into operation on day one.
The White House’s decision to skip over Elizabeth Warren, the hands-down favorite of the political left to lead the bureau, who is credited with inventing it and has been setting it up in an advisory capacity, left her supporters disappointed on Sunday but ready to support Cordray. The bureau cannot fully carry out its mission to enforce consumer protections for all financial providers until a permanent director is in place; Cordray, who was hand-picked by Warren to head the agency’s enforcement, has a reputation for being tough.
“While I am disappointed that Elizabeth Warren won't be at the top of the agency she envisioned, Cordray was one of her first hires as its director of enforcement, and was by all accounts a smart and tough attorney general in Ohio -- dual experience that makes him an excellent choice,” said Rep. Carolyn Maloney, D-N.Y., in a press release on Sunday. Maloney has been one of the most vocal advocates of Warren, helped leading the charge in Congress for Obama to select her for the post. Cordray, she said, “has Elizabeth Warren's confidence, and so I wish him well as the CFPB opens its doors this week."
Stephanie Taylor, the co-founder of the Progressive Change Campaign Committee, which launched a petition to nominate Warren that collected more than 350,000 signatures, expressed disappointment.
“With her track record of standing up to Wall Street and fighting for consumers, Elizabeth Warren was the best qualified to lead this bureau that she conceived -- and we imagine Richard Cordray would agree,” Taylor said in a statement. “That said, Rich Cordray has been a strong ally of Elizabeth Warren's, and we hope he will continue her legacy of holding Wall Street accountable."
But Republicans have insisted that their opposition is to the agency itself, not just Warren. Sen. Richard Shelby, R-Ala., the ranking member on the Senate Banking Committee, where such a nomination would first be considered, and whose support would be crucial for reversing others in the GOP, gave no indication on Sunday that Republicans planned to back down.
"Although this deadline has been known for nearly one year, President Obama waited until the last possible moment to act. For months he has ignored Republican concerns about the lack of accountability at the [consumer bureau] and its potential adverse effect on the economy,” Shelby said in an e-mailed statement. “Until President Obama addresses our concerns by supporting a few reasonable structural changes, we will not confirm anyone to lead it. No accountability, no confirmation."
Earlier this spring, 44 Senate Republicans sent Obama a letter saying they would oppose any nominee for the agency, unless it was subjected to appropriations and changed from a director-run organization to a five-member commission, and unless other federal financial regulators were given more power to block its actions.
Although Warren is expected to return to teaching at Harvard University, Democrats have tried to woo her to challenge Sen. Scott Brown, R-Mass., in the 2012 elections, in part as a way to remove the pressure on the administration to appoint her to the consumer agency. Warren has built a national profile as a consumer advocate and could easily use that experience to help her campaign should she decide to run.
For her part, Warren commended the president’s selection of Cordray and urged supporters of the agency to remain vigilant in defending it from those seeking to weaken it.
“Rich has a proven track record of fighting for families during his time as head of the CFPB enforcement division, as attorney general of Ohio.... He will make a stellar director. I am very pleased for Rich and very pleased for the CFPB,” Warren said in a press release. “I remain hopeful that those who want to cripple this consumer bureau will think again.... Partisanship may be the most important thing in Washington, but in the rest of the country people expect their public servants to work together to learn from past regulatory failures and to put our energy into solving problems, not scoring political points.”
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