Washington Microcosm

Senator Warren?

Not only would Elizabeth Warren be the most qualified person to run the new Consumer Financial Protection Bureau, the agency that she essentially created, but fighting for her nomination would provide a perfect opportunity to contrast the anti-regulation, pro-corporate Republicans with support for the unmitigated champion of consumer protection.  Indeed, the fact that she has been so demonized by the GOP should provide a clue as to how effective she would be.  As Paul Krugman said a while back, "by the sheer craziness of their attacks . . . Republicans are offering the administration a perfect opportunity to revive the debate over financial reform, not to mention highlighting exactly who’s really in Wall Street’s pocket these days."

So, of course, President Obama decided that Warren was too much of a lightening rod and nominated former Ohio Attorney General Richard Cordray instead.  (Perhaps a more significant factor in dooming Warren's nomination was the opposition of Treasury Secretary Geithner, who feared her aggressiveness in pushing for financial reform.)  Cordray, by all accounts, is an excellent second choice and is supported by Warren herself.  But that is not the point.

By failing to nominate Warren, Obama has not only missed a golden political opportunity, he has done nothing to appease the Republicans -- because he can never appease the Republicans.  As the Times reports, already "forty-four Republican senators have signed a letter saying they would refuse to vote on any nominee to lead the bureau," demanding instead changes that would dilute the Dodd-Frank law that created the agency, including replacing the director position with a 5-person board.

So what now?  Obama needs to install Cordray as the agency’s director by using a recess appointment, which he should have done to appoint Warren, and ensure that the agency can finally start doing its important work.

As for Warren, the good news is that she may be persuaded to run for the Massachusetts Senate against Republican Scott Brown.  As Robert Kuttner put it, this is "the bigger stage and more important use of her stunning talents."  And a Steve Benen says, "If Warren runs and beats Brown next year, I wonder how much Senate Republicans will come to regret the decision to block her CFPB prospects?"