Obama Punts on Warren to Head CFPB

by Mark Wilson

In abandoning the recess appointment of Elizabeth Warren to head the new Consumer Financial Protection Bureau, President Obama continues to show that he has no stomach for pushing concerns that he cares about. Professor Warren made a career of consumer protection at Harvard Law School, which is precisely why Republicans are terrified of her. The double standard couldn’t be more obvious: a person in charge of a regulatory agency will pass Republican muster if and only if he or she can demonstrate inefficacy in furthering the mission of that agency, preferably by coming from the industry that he or she has been selected to regulate. In the Bush Administration, for example, heads of cabinet departments were selected based on their proximity to the industries they would ostensibly regulate, with the implicit goal of not enforcing regulations adverse to those industries. For example, the head of the U.S. Forest Service under President George W. Bush was a former timber industry lobbyist.

So it’s okay to bring in someone who will not enforce the law. When it comes to Warren, it is explicitly unacceptable to have an agency chairperson who will actively and passionately fight for the goals of that agency if those goals are adverse to large businesses (as represented by the U.S. Chamber of Commerce). In other words: if your guy won’t enforce the law, that’s great. But if your guy will enforce the law, he’s got to go.

If Obama recognizes this blatant and pervasive double-standard, he’s not saying. But he’s certainly not putting up a fight. And even in the case of Richard Cordray, Republicans have made it very clear that he won’t survive. And why would he? Cordray is competent, well-qualified, and would bring a similar level of care to the CFPB as Warren. And for Republicans, that’s just out of the question. That’s why they would rather neuter the Bureau by replacing “a single leader with a board of directors.” The more people that can be put in charge of the CFPB, the more it can be watered down and made impotent. The U.S. Chamber of Commerce couldn’t ask for a better outcome outside of eliminating the CFPB completely. It is to their advantage not to have oversight.

Republicans’ intent in this matter couldn’t be more transparent: for years, the tactic was to destroy a legitimately-created federal agency, whose existence they disagreed with, by staffing that agency with either incompetent cronies (see FEMA under “Heckuva Job” Michael Brown) or industry patrons (like the U.S. Forest Service). That Obama doesn’t call them out on their blatant disgust for a functioning government places as much blame with him as it does with the Republicans.