Warren's Gone But Her Agency Remains
With American struggling to get its economy back on track, it is becoming clear that regulations coming from the Obama Administration are smothering the recovery in its tracks. From the EPA to the National Labor Relations Board (NLRB), an alphabet soup of regulatory agencies are driving up the cost of higher new people and the cost of goods and services.
But there is one agency that could dwarf the others in terms of destructive power – the Consumer Financial Protection Bureau (CFPB).
The progressive hero Harvard professor and Democratic Senate candidate from Massachusetts, Elizabeth Warren, designed the CFPB. The CFPB was incorporated into the financial reform legislation by Sen. Chris Dodd (D-CT) as a regulatory agency “unlike one we have never seen before.” The agency was given incredible power to regulate every financial transaction in America. Layaway plans to payday loans from businesses large and small all fell under their purview.
Perhaps the most startling aspect of the agency was it was intended to be isolate from checks and balances of normal government agencies. During the course of the legislative process, the agency was renamed a bureau and its headquarters housed in the Federal Reserve who pays its bills. Congress has little oversight of the Bureau, cannot restrict its funding and its director can only be replaced from his five year term with cause.
Warren was expected to head the Bureau but President Obama got cold feet. Instead she recommended former Ohio Attorney General Richard Cordray – a man who shares her liberal views on regulations – to head the office. She ran back to Massachusetts to run for the US Senate.
With Richard Cordray prepared to advance Warren’s agenda, Sen. Richard Shelby stood up for the Constitution and the economy by saying “not so fast.” Shelby organized 43 other Republican Senators to oppose the Cordray nomination until structural reforms are made the CFPB. Shelby and the Republicans are demanding proper checks and balances be put into place before one man is given the power to wreck the economy.
In addition, news has begun to leak out that Cordray – the proposed Wall Street “cop on the beat” – is neck deep in a pay to play scandal back in Ohio. Cordray would deputize security litigation law firms to sue on behest of the state. In return, the Ohio Democratic Party became flush with cash from the same litigation firms. This promises to play out should the confirmation process move forward.
The last thing the economy can afford is a powerful one man-wrecking crew reworking the economy in his image without regard to the impact on jobs.