54 Senators On Record Backing Cordray for CFPB Post

Photograph by Andrew Harrer/Bloomberg

Richard Cordray, director of the Consumer Financial Protection Bureau (CFPB), speaks during a Senate Banking Committee hearing in Washington on Feb. 14, 2013.

President Barack Obama already knew that Senate Democrats supported his choice of Richard Cordray to direct the Consumer Financial Protection Bureau. So why did 52 Democrats and two like-minded independents put their signatures to a letter today telling him what he already knew?

One answer is that it will help in the arcane world of Senate procedure. In addition to trying to increase public support for Cordray, Democrats are working to head off any Republican attempt to introduce an amendment or bill that would alter the way the bureau is governed as a condition for confirming Obama’s pick. With 54 senators using the letter to go on record against that idea, any such measure would be set aside automatically, a Senate Democratic aide said.

“We oppose efforts to weaken the CFPB through structural changes, including as the price for Senate approval of director Cordray’s nomination,” the letter reads.

Cordray, a former Ohio attorney general and possible gubernatorial candidate there in 2014, has seen his bid for confirmation stalled by united Republican opposition since 2011. Obama gave him a recess appointment on Jan. 4, 2012, and then re-nominated him for the job last month.

A few days later 43 Republicans — three more than needed to sustain a filibuster — signed a letter saying they wouldn’t confirm anyone to the post until Obama agrees to structural changes to the bureau, created by the 2010 Dodd-Frank law.

Fans of the bureau have expressed fears that the GOP might be able to slice off a few moderate Democrats to support a bill on restructuring, enough to get it passed in the Senate. The letter effectively preempts such an effort.

Obama hasn’t always been seen as the most ardent of bureau fans. The president waited until a few days before the new agency started work to first nominate Cordray in July 2011. He didn’t mention CFPB or Wall Street in his State of the Union address earlier this week.

Still, Elizabeth Warren of Massachusetts, the Democrat who helped conceive and set up the agency, says Obama is fully engaged, and both sides are drawing battle lines.

“The president has taken on this fight well in advance of when he had to,” Warren told reporters yesterday. “He’s moving on Rich Cordray.”

Meanwhile, even as Democrats try to turn up the heat in the court of public opinion, the courts may yet give Republicans the leverage they need to force changes to Dodd-Frank.

A recent appeals court decision invalidated three recess appointments to the National Labor Relations Board made the same day as Cordray’s, but no company had made an issue of the CFPB head until yesterday.

State National Bank of Big Spring — a small town in Texas — amended a previous complaint it filed in U.S. District Court in Washington to include a charge that Cordray’s appointment was unconstitutional. If the case proceeds, it could become the legal challenge opponents have been hoping for.

The government has contested the bank’s standing to bring the case, since it is too small to be supervised by the CFPB. Also, most agency regulations that could affect it have yet to take effect. As a result, it’s too soon to say whether the Senate or the courts will be the final arena for the battle over Cordray.

 

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