Rich Cordray's Recess Appointment To Head The CFPB

Miss McConnell flipped out Wednesday morning when President Obama, sickened by Republican partisan obstructionism meant to wreck the Consumer Financial Protection Bureau (CFPB) on behalf of their Wall Street donors, recess-appointed Rich Cordray to head the new agency. The GOP has always opposed, although rarely as blatantly and stridently as in the last few years, any and all attempts to protect consumers from predators. Steve Benen addressed Miss McConnell's phony-baloney concerns. Here in part is what President Obama had to say in Cleveland when he announced the appointment:

[T]oday, we’re taking another important step-– one that will bring us closer to an economy where everyone plays by the same rules. And to help us do that, I’m joined by someone you might recognize: Richard Cordray.

Today I’m appointing Richard as America’s consumer watchdog. That means he’ll be in charge of one thing: looking out for the best interests of American consumers. His job will be to protect families like yours from the abuses of the financial industry. His job will be to make sure you’ve got all the information you need to make important financial decisions. Right away, he’ll start working to make sure millions of Americans are treated fairly by mortgage brokers, payday lenders and debt collectors. In fact, just this week, his agency is opening up a simple, 1-800 number you can call to make sure you’re getting a fair deal on your mortgage, and hold banks and brokers accountable if you’re not.

I nominated Richard for this job last summer. And yet, for almost half a year, Republicans in the Senate have blocked his confirmation. They’ve refused to even give Richard and up-or-down vote. It’s not because he’s unqualified. There is no question that Richard is the right person for this job. He’s got support from Democrats and Republicans. A majority of Attorneys General from both parties across the country have called for Richard to be confirmed. Your local Members of Congress who are here today-– they support him. He has the support of a majority in the Senate. Everyone agrees that he’s more than qualified.

The only reason Republicans in the Senate have blocked Richard is because they don’t agree with the law setting up the consumer watchdog. They want to weaken it. Well that makes no sense at all. Does anyone think the reason we got in such a financial mess was because of too much oversight? Of course not. We shouldn’t be weakening oversight and accountability. We should be strengthening it-- especially when it comes to looking out for families like yours. Financial firms have armies of lobbyists in Washington looking out for their interests. It’s time someone fought for you, too.

This is a fight that Richard has been waging here in Ohio for the better part of two decades. As your Attorney General, he helped recover billions of dollars in things like pension funds on behalf of retirees, and protected consumers from dishonest lending practices. Before that, Richard was the State Treasurer, where he earned a reputation for working with folks from across the spectrum-– Democrats, Republicans; bankers and consumer advocates.

Cleveland, you’ve seen the difference that Richard can make for consumers. I have too. And that’s why I want Richard to keep standing up for you-– not just here in Ohio, but all across the country.

Every day that Richard waited to be confirmed was another day when millions of Americans are left unprotected. Without a Director in place, the consumer watchdog agency we’ve set up is left without the tools it needs to prevent dishonest mortgage brokers, payday lenders and debt collectors from taking advantage of consumers. That’s inexcusable. It’s wrong. And I refuse to take “no” for an answer.

I’ve said before that I will continue to look for every opportunity to work with Congress to move this country forward and create jobs. That means putting construction workers back on the job repairing our roads and bridges. That means keeping teachers in the classrooms and cops and firefighters on the streets. That means helping small businesses get ahead. These are ideas that have support from Democrats, Republicans and Independents. And I want to work with Congress to get them done.

But when Congress refuses to act and as a result hurts our economy and puts people at risk, I have an obligation as President to do what I can without them. I have an obligation to act on behalf of the American people. I will not stand by while a minority in the Senate puts party ideology ahead of the people they were elected to serve. Not when so much is at stake. Not at this make-or-break moment for the middle class.

For too long, we’ve had a financial system that stacked the deck against ordinary Americans. Banks on Wall Street played by different rules than businesses on Main Street-– or a lot of community banks. Hidden fees and fine print led consumers to make financial decisions they didn’t always understand. And all that risky behavior led to an economic crisis that we’re still digging ourselves out of.

That’s why, last year, we put in place new rules of the road to make sure that a few bad apples in the financial sector can’t break the law, cheat consumers, and put our entire economy in danger. Many of these provisions are already starting to make a difference. And for the first time in history, we put in place a consumer watchdog-– someone whose only job is to look out for the interests of everyday Americans.

Richard is the right man for this job. If you’re a student, his job will be to protect you from dishonest lending practices and make sure you have all the information you need on student loans. If you’re a veteran, he’ll help make sure you aren’t taken advantage of when you come home from serving our country. And if you’re a senior, he’ll help make sure you don’t lose your home or your retirement because someone saw you as an easy target.

I'd like to share some other responses that came in from interested parties. First, from Elizabeth Warren, the woman who put the CFPB together and whom the Republicans refused to approve to head it. "For months," she told supporters of her Massachusetts Senate campaign,

determined as ever to protect Wall Street and the big banks instead of you, Republicans stymied the consumer agency from doing its job. Republicans demanded changes that would weaken the agency and its ability to protect you, and they filibustered the nomination of Richard Cordray as its director. The big banks were winning once again until today-- when President Obama gave Cordray a recess appointment!

This is a big deal for middle class families in Massachusetts and across our nation. For more than a year, we've seen and heard reports exposing how some of America's largest financial institutions broke the law. Maybe that's why Wall Street continues to set new spending records hiring lobbyists to shift attention away from their wrongdoings. As a result, those who broke our economic system haven't been subject to full scrutiny. But with Richard Cordray in place at the CFPB, we can start moving toward real accountability over the big banks.

Even her Republican opponent, freaked out by her polling numbers, which show she'll beat him in November, broke with his party and issued a statement that must have had Miss McConnell cursing and stomping his feet:

I support President Obama's appointment today of Richard Cordray to head the CFPB. I believe he is the right person to lead the agency and help protect consumers from fraud and scams. While I would have strongly preferred that it go through the normal confirmation process, unfortunately the system is completely broken. If we're going to make progress as a nation, both parties in Washington need to work together to end the procedural gridlock and hyper-partisanship.

Sounds like someone in the White House press office could have written that for him!

Next, two of the Democrats who fought hardest to establish the CFPB against GOP obstruction at every level, Barney Frank and Brad Miller, on the House Financial Services Committee. First Barney:

Republican’s complaints about the President’s decision to make this recess appointment are equivalent to objections leveled by arsonists at people who use the fire door to escape a burning building... Having failed legislatively to block the creation of an independent-- independent from undue influence from the financial industry-- consumer bureau, Republican Senators bent the Constitution out of shape by high-jacking the confirmation process to weaken the Consumer Bureau in ways they were unable to do through legislative process.

President Obama has responded in an entirely appropriate way to their refusing to consider a nomination, not because of any flaws in the nominee, but because they are frustrated that they are unable to repeal, or weaken, a duly passed statute. Even the most extreme opponents of consumer protection have not raised any serious objection to Mr. Cordray’s qualifications, and he has in fact been supported in a bipartisan way by many of those with whom he has worked when he was Attorney General of Ohio.

The installation of Mr. Cordray as Director means that consumers can now be protected against a full array of financial practices. This does not mean that the majority of payday lenders, or check cashers, or people involved in transmitting cash remittances are dishonest or unscrupulous. It does mean that in any business, there will be those who will try to take unfair advantage of consumers, and those consumers will now have a strong, well-constructed independent agency to which they can turn in those cases.

Brad, who worked hard to pass the enabling legislation for the Bureau, is on the same page:

President Obama made the right decision to move forward with this appointment. He's tried for well more than a year to negotiate in good faith with Senate Republicans, but there's been no good faith by Senate Republicans. Their abuse of constitutional confirmation powers and Senate rules is unprecedented. The authors of our Constitution never intended confirmation powers to be used to sabotage a President's ability to run the government... There is no question that Cordray would be confirmed in a fair up-or-down vote. His appointment is an excellent first step. Now President Obama needs to fill the vacancies at the Office of the Comptroller of the Currency, the Federal Housing Finance Agency, and the Federal Deposit Insurance Corporation.

President Obama's announcement in Ohio meant a lot to an Ohio congressman I spoke with a few hours ago, Dennis Kucinich, once the mayor of Cleveland, now one of the most dedicated defenders of working families anyone. He's worked with Rich Cordray and thinks he was the right guy for a job that very much needed-- especially for northeast Ohio, ground zero for the housing fraud perpetrated on consumers by crooked banksters. "As a Clevelander," he told me, "I saw predatory lenders swoop into our community and operate with impunity. We needed such a fully functioning bureau years ago to protect consumers. Cordray's appointment is right for American consumers, whose aspirations for a fair marketplace were being thwarted by certain interest groups who cash in from sharp practices."

New York State Attorney General Eric Schneiderman, who's on the front lines in the battle against Wall Street predators, issued a statement applauding the appointment which said in part:

This is a major victory for American families seeking justice with the banks and other lending agencies at the heart of the financial crisis. The repeated procedural roadblocks that have blocked Richard Cordray's appointment represent the worst sort of partisan politics in Washington, and President Obama must be commended for taking action in the pursuit of meaningful protection for American consumers.

More than three years after the financial crisis dragged the economy into recession, there is much work to be done to restore confidence in the markets for everyday people, homeowners, businesses and investors. As a watchdog holding financial institutions accountable for wrongdoing, Richard Cordray and the CFPB will play a critically important role in developing a regulatory framework that ensures consumers are protected, and our economy is not vulnerable to another financial meltdown. We look forward to working closely with the agency to advance the economic interests of New York’s consumers."

Basically all the Blue America House candidates backed this appointment as well. John Waltz, who's running against Michigan plutocrat Fred Upton, a die-hard opponent of consumer protection, summed up what all our candidates have been saying:

I support President Obama's decision to use the authority provided by our Constitution to appoint Richard Cordray to head the Consumer Financial Protection Bureau. It's high time that those of us in the 99% have someone that will stand up to predatory lenders and other special interest that exist only to cause us harm."

Here's how the White House responded to Miss McConnell and other dishonest Republican corporate shills who charge the appointment is an abuse of power.

The Constitution gives the President the authority to make temporary recess appointments to fill vacant positions when the Senate is in recess, a power all recent Presidents have exercised. The Senate has effectively been in recess for weeks, and is expected to remain in recess for weeks. In an overt attempt to prevent the President from exercising his authority during this period, Republican Senators insisted on using a gimmick called 'pro forma' sessions, which are sessions during which no Senate business is conducted and instead one or two Senators simply gavel in and out of session in a matter of seconds. But gimmicks do not override the President’s constitutional authority to make appointments to keep the government running. Legal experts agree. In fact, the lawyers who advised President Bush on recess appointments wrote that the Senate cannot use sham 'pro forma' sessions to prevent the President from exercising a constitutional power.

Another House Financial Services Committee member when the Bureau was being created, Alan Grayson, pointed out wryly that Cordray "was everyone's second choice. I'm glad that everyone's first choice will be in the U.S. Senate next year."

AND AS TO THE APPOINTMENTS OF SHARON BLOCK,
TERENCE FLYNN AND RICHARD GRIFFIN TO THE NLRB

Greg Sargent writes about the three recess appointments to the National Labor Relations Board, which had also come up against immovable Republican obstruction:

The move, which is arguably as important as the Cordray appointment, will ratchet up opposition from Republicans and make this an even bigger fight, since they have been attacking the NLRB regularly for its moves to streamline union elections and inform workers of their rights. . . .

Obama’s move, which will help energize unions in advance of the 2012 election, is yet another sign that he is determined to circumvent GOP opposition and make government functional again by any means necessary. It’s another sign that the White House and Dems have abandoned the illusion that anything can be done to secure bipartisan compromise with Republicans on the major items on Obama’s agenda.

Greg includes a statement from AFL-CIO President Richard Trumka "commending" the President as well as a rebuttal by Travis Waldron to inevitable GOP "outrage" over supposed presidential overreaching, pointing out that "the past three Republican presidents also made recess appointments to the NLRB. Ronald Reagan and George H.W. Bush each made three recess appointments to the NLRB, while George W. Bush made seven such appointments."