GOP Blocks Crucial Consumer Protection Bureau Nominee

Politics

President Obama lashed out at Congress on Thursday for blocking his nomination to head a consumer financial watchdog agency, saying Americans are frustrated with legislators for holding up critical appointments to win concessions on other matters.

Speaking shortly after the Senate rejected his appointment of former Ohio attorney General Richard Cordray as head of the Consumer Financial Protection Bureau, Obama said his Capitol Hill adversaries were not acting “on the level” in their consideration of the public interest. And he complained that Republicans in Congress were systematically delaying his political appointments.

“This makes no sense,” Obama said during a short news conference in the White House briefing room. “Consumers across the country understand part of the reason we got into the financial mess we did is because regulators are not doing their jobs. ... There is no reason why Mr. Cordray should not be nominated or confirmed by the Senate and should not be doing this job.”

Obama added that he would press forward with trying to install Cordray, including a potential recess appointment during the holiday break, a move that Congress could not block if it were not in session.

“We are not giving up on this; we’ll keep on going at it,” Obama said. “We will not allow politics as usual on Capitol Hill to stand in the way of American consumers being protected from unscrupulous operators.”

He added that Congress has been systematically holding up many of his other appointments.

“Well-qualified judges do not get a vote. Assistant secretaries to the Treasury get held up for no reason,” Obama said. “They are trying to see if they can use that to reverse some sort of law that’s already been passed. That’s what part of what gets the American people so frustrated. The do not think this is on the level.”

Senate Republicans on Tuesday filibustered Obama’s nomination of Caitlin Halligan to the U.S. Court of Appeals for the District of Columbia Circuit. Then in the long-awaited vote Thursday morning, Senate Republicans relied on a procedural vote to keep the Senate from even considering Cordray for the top job at the Consumer Financial Protection Bureau.

By a vote of 53 to 45, Senate Democrats were unable to close off debate to allow the confirmation to proceed; 60 votes were needed to end a filibuster.

Though GOP lawmakers have praised Cordray’s qualifications for the job -- he currently serves as the CFPB’s director of enforcement -- they have pledged to prevent any candidate from being confirmed unless significant structural changes are made to the bureau.

Republicans want the director replaced by a five-member commission and tighter oversight of the agency’s decisions by other regulatory bodies. They are also seeking to subject the CFPB to the congressional appropriations process; currently, it is funded through the Federal Reserve.

Democrats have balked at those requests, leaving the leaderless bureau trapped in a political stalemate. Though the CFPB can enforce existing consumer regulations, it cannot begin oversight of so-called “nonbank” financial institutions such as payday lenders, prepaid card providers and private student lenders until a director is confirmed.

It remains unclear what the next step for the Obama administration will be. The White House has been reluctant to name a director through recess appointment despite pressure to do so by several Democratic lawmakers and consumer advocacy groups.

In addition, Republicans have prevented the Senate from going on recess at all, instead holding pro forma sessions aimed at blocking any appointments. According to the Congressional Research Service, the shortest recess during which a presidential appointment has been made in the last 20 years was 10 days. The appointee also could only serve until the next session of Congress; a confirmed CFPB director would serve for five years.

Only two of the 47 Republicans in the Senate did not vote to block Cordray’s confirmation. One was Sen. Olympia Snowe (R-Maine), who voted “present.” The other was Scott Brown of Massachusetts, who is facing the CFPB’s original architect, Elizabeth Warren, in the 2012 Senate race.

“I disagree with Republicans on this issue,” Brown said in a statement explaining his “yes” vote. “Mr. Cordray deserves an up or down vote, and I look forward to supporting his nomination. Having a leader at the helm is critical at a time when the agency is getting up and running. The unfortunate truth is that there are still bad actors in the financial system who will take advantage of vulnerable people in our society.”

GOP Blocks Crucial Consumer Protection Bureau Nominee

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