President Obama’s nominee to become the first director of the government’s newest consumer protection agency passed his first test today, as the Senate Banking Committee voted to confirm Richard Cordray, sending his nomination to the full Senate.
The vote split down party lines, with the committee’s 12 Democrats in support and its 10 Republicans opposed. It may be the last movement on Cordray’s bid to lead the Consumer Financial Protection Bureau for quite some time, since Senate Republicans have repeatedly stated that they will block any attempt to confirm Cordray to the post.
And Republicans appear prepared to go to extraordinary lengths to follow through on that threat. Already this year, Republican leaders in the House took the highly unusual step of preventing both houses of Congress from officially going into recess, denying President Obama the chance to name Cordray to the job in a recess appointment without Congressional approval.
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Prior to the hearing this morning, Obama responded during a press conference to Republicans’ threats to block Cordray’s nomination.
“I’m going to be fighting every inch of the way here in Washington to make sure that we have a consumer watchdog that is preventing abusive practices by the financial sector. I will be hugely supportive of … banks and financial institutions that are doing the right thing by their customers. We need them to be lending,” he said. “But until the American people see that happening, yes, they’re going to continue to express frustrations about what they see as two sets of rules.”
This week, Obama suggested that the new bureau has the power to prevent banks from charging some fees, including Bank of America’s controversial plan to begin charging customers $5 a month to make purchases with their debit cards.
[Related Article: Obama Blasts BofA's New $5 Fee]
“Well you can stop it,” Obama said. “This is exactly why we need this consumer financial protection bureau that we set up that is ready to go.”
Republicans said the president’s comments support their argument that the bureau and its director have too much unchecked power over the financial products that Americans can buy.
“This week, the President let slip his true vision for the Bureau—to dictate what consumers can buy and how much they will pay,” Senator Richard Shelby (R-AL), said in a prepared statement.
“The President’s comments reveal the grave economic impact that this unchecked bureaucracy could have on the American economy.”
Democrats continued to point out, meanwhile, that the bureau’s powers and budget are limited in ways that other financial regulators are not. And they lauded Cordray’s credentials for the post.
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“I hope my colleagues on the other side of the aisle will set aside partisan ideology and focus on the needs of middle-class Americans,” Senator Sherrod Brown (D-OH) said in a statement. “Richard Cordray’s distinguished career—Supreme Court clerk, attorney, Ohio Solicitor General, Ohio Treasurer and Ohio Attorney General—has shown he is the right person for the job at the right time for our country. It is time to put this consumer cop on the beat.”
Senate Majority Leader Harry Reid has not yet announced any plans to bring Cordray’s nomination to a full Senate vote.
Image: Veronica V photography, via Wikimedia Commons