Maybe Bill Clinton was right.
Everybody in Congress and in the Obama administration said they are for consumer protection. However, in the debate over the new consumer bureau, it seems to be the case–to paraphrase the former president–that it depends on what the meaning of "consumer protection" is.
The disagreements about the structure and leadership of the Consumer Financial Protection Bureau are mostly breaking down along party lines. Being against consumer protection would be like being against apple pie.
Last year, the Democratic-controlled Congress passed a financial overhaul bill that created the bureau, which is supposed to begin operating in May.
Republicans fought the bill at every turn and were especially opposed to the new bureau. They argued that it would duplicate the efforts of existing regulators, punish those who didn’t cause the financial crisis and add to regulatory burdens.
That’s the argument that some credit union lobbyists made. They contended that since credit unions were among the angels of the financial crisis, they didn’t need additional regulatory burdens.
Proving that in many Washington policy clashes nothing is ever really settled, the GOP is trying to re-fight that battle. House Republicans (who now control that chamber) are on track to pass a series of structural changes to the agency.
Senate Republicans are threatening to filibuster the confirmation of anyone President Obama nominates to run the bureau if Obama and Senate Democrats don’t agree to structural changes in the bureau. Senate Democrats, who hold a majority of seats but not the 60 needed to break a filibuster, say no dice.
Obama could circumvent lawmakers and name a new director as a recess appointment, which would allow him or her to serve until the end of 2012.
Such a move would give Obama what he wants in the short term. He would have someone running a bureau that is quite important to him. And if he picked Elizabeth Warren, who came up with the idea and is in charge of setting up the bureau, he’d be sending the political equivalent of a bouquet of roses to his liberal base. That’s important leading up to an election since many on the left think Obama has gone wobbly.
The downside to such a move is that he would alienate congressional Republicans, whose votes he needs on certain bills. But since the GOP has said defeating Obama next November is its No. 1 priority, comity and bipartisanship may be in short supply during the next 18 months.
