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The Tail Wagging the Dog? Senate Republicans Block Confirmation of CFPB Director, White House Calls on State Attorneys General for Assistance By Rebecca E. Neely In what appears to be a classic case of the tail wagging the dog, the Senate Republicans are holding up the confirmation of a director for the Consumer Financial Protection Bureau (CFPB), which was formed in 2010 following Congress’s approval of a massive revamping of the nation’s financial system.
During this past summer, Richard Cordray, a former attorney general in Ohio who was well known for aggressively pursuing foreclosure fraud, was selected by Obama to manage the new agency, but he must be confirmed by the Senate before he can do so. According to the October 18th washingtonpost.com article, “State attorneys general push for Cordray to lead federal consumer agency”, the White House has, in recent days, called upon a group of state attorneys general from both parties “to help break a blockade by Senate Republicans of President Obama’s nominee to lead the controversial new federal consumer watchdog agency.” Obama economic adviser Brian Deese, who was with said attorneys general on a conference call earlier in the week, along with reporters, was quoted as saying: “It’s important from our perspective to continue to push and continue to add voices. There is no reason why the Senate cannot and should not move forward.” The situation has become politically charged, with pressure mounting from various sources, including the growing Occupy Wall Street movement and consumer aggravation regarding new bank fees. Obama is now clamoring for a director, after being criticized for waiting almost a year following the CFPB’s creation to select a nominee.
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What’s the hold up? That Cordray comes with glowing references and possesses significant qualifications seems to the consensus among all parties involved. That the CFPB combines powers formerly spread over seven different agencies appeared to be a step forward as far as efficiency goes, but Senate Republicans want, not a director, but a five-member board to run the show. This in turn, would require the agency to route through Congress for funding. The leverage? Until a director is confirmed the CFPB has no authority to create rules and oversee financial institutions — in essence, the very purpose for which the agency was created in the first place. Sen. Richard C. Shelby (R-Ala.) was quoted in the article as having said last week in an interview with the Heritage Foundation: “We haven’t heard from the president. Maybe he’s off campaigning. Until we hear from him, I don’t believe we’re going to confirm anyone.” Senate Majority Leader Harry M. Reid (D-Nev.) called the actions of Republicans “obstructionism.”
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