We’ve seen enough trial balloons out of this Administration to cause a run on helium (Big Helium Bailout!), but this latest one courtesy of Bloomberg News is actually a two-fer. First, there’s the speculation that Elizabeth Warren tops the list for Director of the Consumer Financial Protection Bureau, which she devised, fought to get enacted into law, and took the lead in setting up:
President Barack Obama has narrowed the list of candidates to lead the Consumer Financial Protection Bureau to a group of people with financial services experience, including Elizabeth Warren, an administration official said.
Warren, the Obama administration adviser setting up the agency, and the other candidates have all worked in financial services, though not necessarily in private industry, said the official who requested anonymity because the process isn’t public. The administration hopes to make a decision in the next few weeks, the official said.
I’ll note at this point that nobody else is mentioned in this piece other than Warren. The characterization of candidates who have “worked in financial services, though not necessarily in private industry” leaves in someone like Sarah Bloom Raskin, the former Maryland consumer protection official now on the Fed Board of Governors, who has been touted (although she just got to the Fed, which already has several vacancies of its own). There’s also been a little buzz for Sheila Bair, who only has a few months left on her term as the head of the FDIC. But neither of those candidates get into this piece.
But the more important trial balloon here is that there will almost certainly be a recess appointment for the position.
Obama met recently with advisers to discuss the nomination, according to a person briefed on the talks. He may announce a nominee with the expectation that he will make a recess appointment if it becomes clear the Senate won’t confirm a director in time for the bureau’s scheduled July 21 start date, according to a person with knowledge of the bureau’s efforts […]
Warren has had meetings in recent weeks with Senate Democrats on the Banking Committee, including Chairman Tim Johnson of South Dakota, Mark Warner of Virginia, Herb Kohl of Wisconsin and Kay Hagan of North Carolina, according to two people briefed on the discussions.
The meetings have the dual effect of updating senators on Warren’s progress in setting up the agency created by the Dodd-Frank Act and tamping down opposition to a recess appointment, said the person with knowledge of the bureau’s efforts.
So, Warren was the emissary sent to Senate Democrats’ offices to warn them about an imminent recess appointment. Which could be herself. And the language here is crucial: a director nominated in May, given the pace of the Senate, cannot possibly get confirmed within a couple months. So, we’re headed toward a recess appointment. [cont’d.]
The main hurdle, at least publicly, for a Warren nomination was the difficulty or near-impossibility, depending on who you talk to, of getting her confirmed. A recess appointment renders that argument moot. She would be able to lead the agency right from the start, as she has already been doing, and mold it in her image with the full set of powers and authorities.
The more private hurdle was the opposition of those inside the Administration to Warren in a strong consumer protection role. But while I’m sure that still exists, perhaps as high as the Treasury Secretary, the fact that candidates like Ted Kaufman and Jennifer Granholm not only turned the job down, but urged the White House to pick Warren, makes it extremely difficult for the Warren detractors to hold out. The independent power base for Warren, separate and apart from the White House, has worked every angle. And it may just succeed.
The timetable here was weeks, so we’ll have an answer come May.