Obama drops Reid appointee
The new Consumer Financial Protection Bureau (CFPD) got up and running on July 21, but the architect of the agency is not its director.
The CFPD was created by the Dodd Frank Act that provided for regulation of Wall Street after the meltdown and bailouts of the Bush administration.
Elizabeth Warren, who proposed creation of the agency before the meltdown, was originally brought into government by U.S. Senator Harry Reid of Nevada to be a member and chair of the Congressional Oversight Panel (COP) that policed the bailouts. Her appointment was reportedly recommended to Reid by Sen. Edward Kennedy. She was a bankruptcy expert and author or coauthor of nine books, including The Two-Income Trap/Why Middle-Class Mothers and Fathers are Going Broke.
Her performance on the COP was so effective that Wall Street and Republicans opposed her heading the CFPD, but she was named one of the 100 most influential people in the world by Time magazine and appeared on the magazine’s cover along with Federal Deposit Insurance Corporation Chairman Sheila Bair and Securities and Exchange Commission Chairman Mary Schapiro under the headline “New sheriffs on Wall Street.”
A year ago President Obama ducked a fight with Senate Republicans by leaving the directorship of the CFPD vacant and appointing Warren a presidential assistant assigned to create the new agency. She spent the last year recruiting staff, creating an administrative structure for the new agency, getting office space and so on.
On July 17 the president passed over Warren for the director’s post and instead appointed former Ohio attorney general Richard Corday, who Warren had hired to be the agency’s enforcement chief.
Warren will return to a professorship at Harvard Law School amid entreaties that she run for the U.S. Senate.
In a speech to the CFPD staff, Warren said she would keep working to “make the credit markets work better for American families and strengthen the economic security of the middle class. I leave this agency, but not this fight.”