Consumer bureau conundrum
Wednesday, September 15, 2010
When it comes to figuring out how best to ensconce Elizabeth Warren, the much-loved and much-loathed Harvard law professor, as the leader of the new Bureau of Consumer Financial Protection, the White House appears to have a dilemma on its hands.
For weeks now, administration officials have weighed various options for how to place Warren at the center of shaping the new watchdog, a role she covets and one that President Obama and others have hinted she will play in one way or another.
The latest news to stoke the blogosphere and ignite passions on both sides of the aisle is that the White House is considering giving Warren an "interim" role at the Treasury Department. Such an approach would allow her to oversee the creation of the consumer bureau while circumventing a potentially nasty and prolonged Senate confirmation process.
The far-reaching financial overhaul bill passed in July leaves room for the interim option. But that idea has run into resistance on Capitol Hill, even as some Democratic senators have said they would support any effort to get Warren in place.
Sen. Christopher J. Dodd (D-Conn.), who shepherded the landmark legislation through the upper chamber, told reporters Tuesday that such a move could jeopardize the credibility of the fledgling consumer bureau and that it would be "met with a lot of opposition." Republican Sens. Olympia J. Snowe (Maine), Susan Collins (Maine) and Scott Brown (Mass.), each of whom voted for the financial bill and each of them a potential swing vote in any confirmation battle, have urged Obama to insist that any nominee face Senate scrutiny.
But going that route poses its own risks, a fact of which White House officials are keenly aware.
For starters, dozens of far less controversial nominees than Warren already have languished in the Senate for months.
"I am concerned about all Senate nominations these days," Obama said at a news conference on Friday. "I've got people who have been waiting for six months to get confirmed, who nobody has an official objection to and who were voted out of committee unanimously, and I can't get a vote on them," he said.
One notable example: three nominees to the Federal Reserve's Board of Governors, including the nominee for the vice chairman of the Fed, are awaiting approval. Dodd said Tuesday that because of limited time and limited appetite, lawmakers might not approve those nominations before leaving town in November.
Leaving Warren in a similar position could sideline one of the country's most visible and compelling consumer advocates - presidential nominees traditionally maintain a low public profile - and prevent her from putting her stamp on the new bureau as it takes shape.
Even then, it could end badly. Dodd has questioned whether Warren is "confirmable," given that many Republicans and financial industry representatives would oppose her confirmation outright. The liberal groups that have lobbied so vehemently for Warren, including a sizable number of Democratic lawmakers, believe that the confirmation process would be a fight worth having. It remains unclear whether the White House agrees.
Though highly unlikely, Obama also could use a November recess appointment to put Warren into place, which would allow her to serve into late 2012 without confirmation.
Though the betting money is on Warren, other candidates that have emerged for the consumer bureau role include Assistant Treasury Secretary Michael S. Barr and Eugene Kimmelman, a top official in the Justice Department's antitrust division.
The new bureau, already being set up by Treasury staffers, will have broad autonomy to write and enforce rules governing credit cards, mortgages and other such loans. Its independent director, once confirmed, will serve a five-year term.
White House spokesman Bill Burton told reporters aboard Air Force One on Tuesday that Warren was "obviously in the mix" for the job and that an interim appointment was "certainly an option," though only one of several. "You can see the options if you just look at the law," he said, adding that Obama would make an announcement on the post "very soon."
Administration officials have been saying a decision was coming soon since the day Obama signed the landmark legislation into law. The difficulties surrounding the choice of how to handle that nomination - along with the fervor Warren stokes in supporters and enemies alike - might go a long way in explaining why the wait continues two months later.