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Obama will put Warren in special advisory role for consumer agency, sidestepping confirmation

The Harvard professor and chief bailout watchdog will take the helm of the consumer protection agency created by the financial overhaul legislation.

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By Brady Dennis
Thursday, September 16, 2010; 1:00 AM

President Obama this week plans to name Harvard law Professor Elizabeth Warren as a special adviser so that she can oversee a new consumer financial protection bureau while avoiding a potentially vicious Senate confirmation fight, according to people with direct knowledge of the decision.

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The appointment would place Warren - adored by liberals and consumer advocates, viewed with suspicion by many bankers and congressional Republicans - in charge of the new regulator that she proposed three years ago to protect Americans against lending abuses.

Warren is expected to take on a dual role as assistant to the president and special adviser to Treasury Secretary Timothy F. Geithner, giving her primary responsibility for shaping the consumer watchdog in the coming months.

The financial overhaul bill signed into law in July gives the new bureau and its leader broad autonomy to write and enforce rules governing credit cards, mortgages and other such loans.

Under the law, the Treasury maintains responsibility for setting up the new regulator until the president nominates a director, subject to approval by the Senate.

By appointing Warren to a post within the administration - much as the White House did with "car czar" Steven Rattner and "compensation czar" Kenneth Feinberg - Obama would free her to act as the bureau's director beginning immediately while avoiding a confirmation battle. The move also will thrill the consumer groups, labor unions, academics and liberal lawmakers that have lobbied relentlessly for her to lead the new regulator.

The administration's plan to appoint Warren was first reported by ABC News.

The decision on one of the most anticipated appointments of the Obama presidency emerged after numerous conversations with Warren and weeks of hand-wringing over which approach to take.

Scores of Obama nominations far less polarizing than Warren's have languished in the divided Senate for months. Warren herself has told allies on Capitol Hill that she would prefer to avoid a prolonged confirmation process.

In addition, Senate nominees traditionally have maintained a low public profile while awaiting confirmation. White House advisers decided that it would be unwise to sideline Warren, given her capacity as an outspoken consumer advocate and the immediate demands of starting a federal agency from scratch.

They also decided against placing Warren in the director's post through a recess appointment, which would have allowed her to serve at least a year without confirmation.

Still, the choice to bypass the Senate promises to infuriate lawmakers of all stripes.


CONTINUED     1        >


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