Tuesday, May 10, 2011, 7:39 AM

Road Block!

Posted by: Chris Jones

In a letter to the White House that was surprising only in that it did not arrive earlier, Senate Republicans have announced their intent to filibuster ANY appointee proposed by the White House to lead the Consumer Financial Protection Bureau.

With a scant 72 days remaining before the Designated Transfer Date, the problem, it seems, is not "who" will be appointed director but rather "whether" there should be a director. The Republicans' letter is focused on accountability and budgetary oversight. Specifically, their wish is to revise the architecture of the CFPB to allow for a board of directors to replace the position of director. Equally importantly, they also seek to move budgetary control away from Treasury and give it to Congress.

Credit.com reported on the filibuster threat here, and in doing so one of its reporters called the development "regrettable." Frankly, we do not find it nearly so regrettable as we do predictable. Republican thought leaders have been voicing these concerns for months and, frankly, since they cannot block confirmation, the filibuster is the only weapon that they have to use as leverage to negotiate any change. Politics aside, unless the intent of the letter is to begin a dialogue as to whom should be the appointee (and to make sure that Republican voices are heard and considered) it seems to us that the letter is exceedingly unlikely to achieve anything more than to become confetti for the next D.C. parade. Point being, the CFPB has been and is being implemented by an unconfirmed "appointee." Elizabeth Warren is widely regarded as the President's top draft pick to run the Bureau. If Republicans stonewall by employing the filibuster, then it will give the White House the cover that it requires to merely continue Ms. Warren in the job that she has been performing for several months without Senate confirmation. By comparison, the liklihood that the CFPB will be run by a board of directors or that Congress will be given budgetary control approaches zero.

However, if Republicans are using the letter to start a public conversation that will end with negotiation over who the nominee should be, then that just might work. With sincere respect to Credit.com, we wouldn't call that regrettable, we would call it smart strategy that may effect moderate leadership at the CFPB.


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