What are the chances that Elizabeth Warren will be confirmed?August 4, 2010 - by
A central part of the new financial regulation reform law is the creation of the new Consumer Financial Protection Bureau (CFPB), which seeks to make sure that consumers are protected against the predatory behavior of banks and credit card companies. Who runs this agency will be a big factor on how strict or how lenient the CFPB’s policies and practices will be.
The front runner for the leader of this new agency is Harvard Law professor Elizabeth Warren. She came up with the idea for a new regulatory agency for protecting consumers from abusive financial products. Her research at Harvard was focused around consumer debt. She chaired the TARP Congressional Oversight Panel. And she has advocated for better consumer financial protections since before the start of the financial crisis.
Despite all this, she is not gauranteed the head of the CFPB and, most surprisingly, both Democrats and Republicans are not definitively taking a side on whether or not she should be appointed for this position.
Senator Chris Dodd [D-CT], the chairman on the Senate Banking Committee, has not supported her appointment. The Wall Street Journal reported recently that Dodd thinks that Warren is qualified, but not “confirmable,” although White House officials have expressed the opposite about her. Instead, Dodd had asked Federal Deposit Insurance Corp. Chairman Sheila Bair to take the position, but she declined. Dodd’s position isn’t unique amongst Democrats. While Warren is very popular throughout the Democratic caucsus, many think that she would be too partisan and impartial to head such a power financial regulatory position. “If an activist is put in charge of this, I think the American people will rue that day,” says Sen. Bob Corker [D-TN].
In general, Republicans are opposed to Warren for the position. First, most of them voted against financial reform and the creation of this CFPB. They definitely don’t want someone in charge of it who might use the full extent of the regulatory powers granted in the bill. Senator Jon Kyl [R-AZ] has said the Warren and her leadership of the Congressional Oversight Panel has been too controversial. Most Republicans argue that Warren’s policies — which are what the CFPB was designed to enforce — would make it more difficult and expensive for consumers to get credit cards, mortgages, and other kinds of loans. This is the sentiment of most Republicans, however some are diverging from this view.
Senator Chuck Grassley [R-IA] had publicly praised Warren for her work protecting tax payers. In reference to Warren’s oversight work, Grassley said “I want to especially mention Professor Warren, … so many times over the last decade and a half, you and I have been on opposite sides of a very important issue and we are probably still on opposite sides of that issue, but you’re really boring in on this and I want to tell you that I really appreciate your work." Sen. Grassely voted against a measure that would have eliminated the CFPB even though almost all Republicans voted in favor of that measure.
If Warren is nominated, 60 votes would be needed to overcome a likely filibuster from Senate Republicans. Assuming that Democrats will vote in the same pattern as they did for the financial reform bill, they will have 59 votes, meaning they will be short one vote to bypass the filibuster. In addition to Gassley, Senator Olympia Snowe [R-ME] also voted with Democrats for financial reform and publicly praised Warren for her work. According to the The New Republic, Sentor Scott Brown [R-MA] and Senator Susan Collins [R-ME] are also Republicans who could cross party lines and confirm Warren if she gets the President’s nomination. Thus, potentially there will be four Republican votes in favor of Warren.
This, of course, is if President Obama nominates her in the first place. The White House has praised Warren for her work, but has not endorsed her or any particular person to head the CFPB. Press Secretary Robert Gibbs said recently that Warren is very confirmable and Senior White House Adviser, David Axlerod, said that Warren is a “obviously a candidate to lead this effort…[even though] there are other candidates as well.
Another potential nominee is Treasury Department Assistant Secretary Michael Barr, who, like Warren, has called for stricter consumer protections and greater transparency for banks and credit card companies. Considering the amount of criticism he has received from Warren, Treasury Secretary Tim Geithner will most likely prefer Barr over Warren for the position. He has, however, publicy praised Warren for her work and said on Charlie Rose that she is an “incredibly capable, effective advocate for reform.” But ultimately, he added, he isn’t endorsing a particular candidate and for the position and that the descision is up to President Obama.