Potluck and Pabst for new consumer crusaders

The Harvard professor and chief bailout watchdog will take the helm of the consumer protection agency created by the financial overhaul legislation.
By Brady Dennis
Washington Post Staff Writer
Friday, December 17, 2010; 11:59 PM

Employees had taped paper snowflakes to the windows and hung a strand of white Christmas lights from the ceiling. Soft music played from an iPod, and a plastic penguin greeted guests arriving from their cubicles two floors below. The potluck offerings stretched across several tables - homemade blackberry cobbler and pineapple upside-down cake, gingerbread cookies and cans of Pabst Blue Ribbon.

The gathering inside the seventh-floor conference room at 1801 L St. NW on Thursday night resembled many office parties this time of year in downtown Washington.

But it was the first holiday celebration for the Consumer Financial Protection Bureau, created in July when President Obama signed into law a far-reaching financial overhaul bill. The bureau will have broad powers to write rules aimed at preventing abuses in mortgages, credit cards and other consumer loans.

To some in the room, the gathering seemed a minor miracle. Over the past two years, as lawmakers wrestled with how to prevent a crisis like the one that crippled the economy in 2008, the bureau's existence often seemed in doubt. It had the Obama administration's support, but Republicans on Capitol Hill criticized the idea of a new agency as government overreach - another layer of bureaucracy that would increase costs on banks and small businesses and constrict access to credit for ordinary Americans. Financial industry lobbyists pushed hard to get clients exempted from the new regulator's reach.

In the end, legislation squeaked through Congress, the consumer protection bureau became reality and now its fledgling staff - some detailed from agencies such as the Federal Reserve and Treasury Department, some in their early 20s, some gray-haired veterans, almost all impeccably dressed - was sipping wine and commiserating about long hours spent assembling a federal bureau from scratch.

"There's so much to know," one female staffer said to a younger male colleague. "There's so much to figure out. You walk out every night thinking, 'What did I miss?' "

But staff members also talked excitedly about what they are building, about the thrill that comes with creating something new - although that something has plenty of critics in Washington and on Wall Street - rather than working merely as another cog in another yawning federal agency established long ago.

"Nobody's punching a clock around here," one recent hire said.

Dan Geldon stood in a corner of the room, soaking up the scene as more staffers poured in. Geldon, a longtime adviser to Elizabeth Warren, the outspoken Harvard law professor tapped to oversee the bureau's setup, spent months advocating behind the scenes for the creation of the regulator. He marveled that what once was a proposal had become reality.

"It all happened so fast," Geldon said. "It's kind of surreal."

Perhaps no one found the scene more surreal than Warren, who first proposed the idea for a new consumer agency in a 2007 journal article and now found herself ensconced in this downtown office building, surrounded by conference rooms with names such as Full Disclosure and Accountability. Warren arrived with her husband, Bruce Mann, a fellow Harvard law professor, and circled the room shaking hands, hugging employees and posing for photos.

Just after 6:30 p.m., as the last snow of the day fell onto the rush-hour sidewalks below, staff members treated Warren to a lengthy poem about their work, in the form of " 'Twas the Night Before Christmas." One section that drew cheers read:

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