The stalemate between Republicans and the White House over who will lead a nascent consumer watchdog agency showed no signs of abating Thursday, despite the emergence of a new candidate with long ties to the financial industry.
Democrats’ top pick for the job, Harvard law professor Elizabeth Warren, is in charge of setting up the Consumer Financial Protection Bureau but has become a polarizing figure among Republicans. The White House instead is considering one of her lieutenants, Raj Date, a veteran of Capital One and Deutsche Bank, as an alternative, according to a person familiar with the matter.
June 2 (Bloomberg) -- William Isaac, chairman of Fifth Third Bancorp, talks about a report that Goldman Sachs Group Inc. received a subpoena from the Manhattan District Attorney's office concerning the firm's activities leading into the credit crisis and the state of financial regulation in the U.S. Isaac speaks with Carol Massar and Matt Miller on Bloomberg Television's "Street Smart." (Source: Bloomberg)
But an aide to Senate Minority Leader Mitch McConnell (R-Ky.) said Thursday that the lawmaker stands by his vow to block any candidate. Late last month, McConnell led 44 senators in a letter to the White House calling for structural changes to the bureau. Rep. Barney Frank (D-Mass.) has accused GOP opponents of discriminating against Warren because she is female, but McConnell’s complaints are much broader.
“It’s not sexist. It’s not Elizabeth Warren-specific,” McConnell spokesman Donald Stewart said. “It’s any nominee.”
It takes only a single senator to hold up the confirmation indefinitely. President Obama could appoint someone during the next congressional recess, but Republicans can keep the Senate in session to block that move.
Republicans want the bureau to be run by a five-member commission rather than a single director. They also called for tougher oversight of the bureau by existing banking regulators and said the new agency should be funded by congressional appropriations. Under the current structure, the bureau’s budget is carved from the Federal Reserve.
A key Democratic aide said Thursday that some senators would welcome the nomination of any qualified nominee, but liberal groups made clear Thursday that they would be unwilling to accept any candidate other than Warren.
Adam Green, co-founder of the Progressive Change Campaign Committee, said a petition circulated by his group and others collected 350,000 signatures supporting Warren. Appointing anyone else, he said, would show “complete and utter weakness” by Obama.
Robert Borosage, co-director of Campaign for America’s Future, said that since another candidate would not be welcomed by either side, the White House should fight for Warren.
“It’s pretty inconceivable that somebody else should get this job,” he said.
The response to Date shows just how entrenched both sides are as the clock winds down to the agency’s scheduled launch date of July 21. If no director is named by then, the fledgling agency will have limited ability to write new rules or supervise certain financial firms that are not banks, such as payday lenders.