Republicans Use Cordray Nomination to Attack the CFPB
Congress created the Consumer Financial Protection Bureau with passage of the Dodd-Frank Act in 2010. It is a balanced approach to oversight of many of the banking practices that led to the financial meltdown of 2008. The CFPB has been called the "brainchild" of Elizabeth Warren, now a Senator (D, Mass) and member of the Senate Banking Committee. Many thought she would have been the CFPB's first Director, but Republicans threatened to block her confirmation at the outset.
Since its inception, the CFPB has operated without a permanent Director. Despite the fact that the Dodd-Frank Act is the law of the land, the financial industry has vowed to obstruct its function and effectiveness. There are reportedly more than 150 lobbyists tasked with attacking the CFPB. One would think that consumer protection would be something both political parties could support. Yet, Republicans have taken the side of the big banks. Since they do not have the votes or public support to repeal the Dodd-Frank Act, they seek to prevent the CFPB's full operation by blocking the confirmation process.
President Obama first named Richard Cordray to be CFPB Director in a recess appointment, and has now re-nominated him to be permanent Director. Cordray's credentials for the position are impeccable. The former Ohio Treasurer and Attorney General is a Marshall Scholar who clerked for the U.S. Supreme Court and has argued numerous cases before the high court. At the same time, he is mainstream and moderate, his approach to regulatory reform has been measured and meticulous.
Cordray's nomination for permanent Director of the CFPB came up for hearing before the Senate Banking Committee today. By all accounts, the hearing was "cordial." Just what that means in today's Congress is entirely unclear. If that means he is not to take a "no" vote personally, that is not the purpose of the confirmation process. The Dodd-Frank Act provides for the creation of the CFPB, and the law provides for confirmation of a qualified permanent Director for the agency.
Sen. Sherrod Brown (D, Ohio), who is one of Cordray's many supporters, summed up the hearing today, “Some (Republicans) here want to nullify the (Dodd-Frank) legislation” and for the first time in history “senators are blocking the nominee because they simply don’t like the agency that he will lead.”
Meanwhile, Elizabeth Warren had this to say, "I think the delay in getting him confirmed is bad for consumers, it's bad for small banks, bad for credit unions, for anyone trying to offer an honest product in an honest market."
Bipartisan polls show that the American people are fed up with obstructionist tactics. As Warren said today, "The American people deserve a Congress that worries less about helping big banks, and more about helping regular people who have been cheated on mortgages, on credit cards, on student loans and on credit reports." American consumers need the CFPB, and the CFPB needs a permanent Director now. More on the effect of today's events can be found here.