"Balanced." "Fair-minded." Showing "great personal integrity." These are some of the terms a bipartisan group of 37 state attorneys general used to describe former Ohio Attorney General Richard Cordray, President Barack Obama's nominee for director of the Consumer Financial Protection Bureau (CFPB). Add to that list "good public servant," the phrase Ohio Republican Sen. Robert Portman used to describe him just days ago.
Sounds like a radical, doesn't he?
If he's not, how else do we explain last week's move by 45 members of the U.S. Senate to block his appointment to that post? After all, by blocking Mr. Cordray's appointment, that vocal minority prevented an already enacted law — the Wall Street Reform and Consumer Protection Act — from being fully carried out, essentially using 45 Senate votes to nullify legislation that passed by significant majorities in both houses of Congress (237 in the House and 60 in the Senate), representing the will of many millions of Americans.
But the Senate minority's vote is not about Mr. Cordray. Rather, it seems to be an attempt to undo the legislative process and protect the financial service industry from additional oversight under the guise of a disagreement about the way the CFPB is structured. Sen. Richard Shelby, an Alabama Republican, said Mr. Cordray's nomination was "dead on arrival," explaining that he and his colleagues "will not confirm any nominee" until changes are made in the CFPB. Sen. Lindsey Graham, in defending his vote to block Mr. Cordray's appointment, likened the CFPB to "something out of the Stalinist era" — apparently because it is too independent from Congress.
It appears that the only way around this obstructionism may be for President Obama to make a recess appointment so Mr. Cordray can get to work for the American people.
Of course, the time to debate the structure of the CFPB was back in 2010, when the Consumer Protection Act came up for debate. At the time, many senators vigorously opposed the act, but they lost. When the debate ended and votes were counted, the act passed and the president signed it into law. That's how democracy works. So whether they think the CFPB is a bad idea is irrelevant; the CFPB is no longer an idea. It is an up-and-running government agency. And, like any agency, it needs a leader — someone who can make tough decisions, provide vision and be accountable for the agency's performance. (Ideally, that someone would be balanced, fair-minded and have great personal integrity, like Richard Cordray.) Voting against Mr. Cordray does not makes the CFPB cease to exist; it only prevents it from benefiting from his leadership.
More importantly, members of the Senate minority seem to think that it is more important to try to protect the financial services industry from effective regulation than it is to protect Americans from financial services abuse. If so, they have the needs of the American people exactly backward. With nearly a quarter of U.S. homeowners underwater on their mortgages, Americans are much more concerned about the financial services industry's lack of accountability to the people than they are about the nuances of how the agency created to protect consumers is structured. The unchecked status quo is what threw so many American consumers into financial crisis in the first place, and they cannot afford to be swindled again. They want government to fight to end the financial services status quo, not fight to keep it.
We state attorneys general know this to be true. When state attorneys general held Countrywide Financial accountable for abusing poor and minority homebuyers, American consumers did not demand less government action; they cheered. The same thing happened when state attorneys general held bad banks and shady debt settlement companies accountable for unfair practices. Now the federal government has an excellent opportunity to expand protections for American consumers, an opportunity created by a law that was itself cheered on by consumers. Clearly, when it comes to the previously unpoliced financial services industry, consumers are demanding a new sheriff in town — not no sheriff in town.
Nonetheless, even though the people have spoken out against the status quo and demanded more government oversight, 45 members of the Senate don't like what they have said, and those members are willing to circumvent the traditional democratic process to advance their own agenda, even if that means keeping well-qualified people like Richard Cordray from assuming positions of authority. In short, a small minority of government officials is thwarting the democratic will of the people so that they can continue to dictate regulatory policy.
Nothing at all Stalinist about that.
Douglas F. Gansler is attorney general of Maryland and president-elect of the National Association of Attorneys General. His email is email@example.com.
- Politics and Government
- Financial and Business Services
- Crime, Law and Justice
- National Government
- U.S. Consumer Financial Protection Bureau
- Richard Cordray
- Justice System
- U.S. Senate
- Doug Gansler
- Laws and Legislation
- Republican Party
- Barack Obama
- Countrywide Financial Corp.
- Richard Shelby
- Robert Portman