WASHINGTON–Sen. Christopher Dodd said the White House risks undermining the powerful new consumer protection agency created to oversee Wall Street if the President tries to install Elizabeth Warren as its first director without a Senate confirmation vote.
Dodd’s comments put him at odds with other Senate Democrats and will likely generate fresh skepticism about his views of Warren, the outspoken Harvard law professor who came up with the idea of the consumer watchdog bureau.
Chris Dodd:
Earlier this summer, while saying he did not oppose Warren’s nomination, Dodd said she could probably not win Senate confirmation because of Republican opposition. But some critics suggested at the time that Dodd was trying to undercut Warren.
Reacting to new reports that the White House may use an interim appointment to bypass a Senate vote on Warren, Dodd said Tuesday: “I’m not enthusiastic about that.”
A chief author of the Dodd-Frank financial reform bill that establishes the new Consumer Financial Protection Bureau, Dodd said any move to bypass Senate confirmation could generate ill-will in Congress and potentially undercut political support for the new agency.
“I think it’ll be met with a lot of opposition,” Dodd said. “This is a very big job, an important job, and you’ve got to build the support for that institutionally.” Failure to do that could lead Republicans, if they gain power after the November elections, to strip the agency of funding or hamstring it in some other way, he argued.
“It jeopardizes the existence of the consumer protection bureau,” Dodd said. “You could gut this before it even gets off the ground.”
The White House is said to be considering two ways of skirting a Senate confrontation: Obama could either appoint Warren during a congressional recess or, under a provision in the Dodd-Frank law, name her as an interim director while the agency is technically overseen by the Treasury Department. Of the latter option, Dodd said, “I don’t think we had quite this in mind” when he and other lawmakers included that interim role in the legislation.
Warren’s supporters sharply disagreed with Dodd’s rationale for opposing an interim appointment.
The Senate’s No. 2 Democrat, Dick Durbin, of Illinois, said he fully backed the idea putting Warren at the helm of the agency without a Senate vote and had spoken to top White House officials about the idea.
“It was her concept … that led to this provision,” Durbin said. “She’s the very best person to put this together.”
What about Dodd’s argument that an interim appointment would somehow weaken the CFPB?
“I don’t know how you can undermine an agency” by putting the person who conceived of it in charge of it, Durbin said.
Maureen Thompson, a spokeswoman for Americans for Financial Reform, a coalition of consumer, labor, and other groups that has been lobbying the White House to appoint Warren, said anything that gets Warren in place quickly is good. She, too, scoffed at Dodd’s argument against bypassing Senate confirmation.
“I don’t think it adds up. Sen. Dodd, as well as anybody, knows why recess appointments are necessary in some instances,” she said. “I’m not sure if that’s a red herring,” she said of Dodd’s remarks, “but my question back to him would be how do you get Elizabeth Warren–or anybody-through the process at this point?”
Thompson said it’s critical to get the agency up and running as soon as possible. And with Congress scheduled to be in session for only a few weeks, she said, there’s almost no chance that any strong nominee-or at least, anyone who would really be a tough Wall Street watchdog–could win a quick vote before the November elections.