The Wall Street Journal editorial pages agree with me.
The president’s gambit to make Elizabeth Warren the de-facto leader of the new Consumer Financial Protection Bureau without Senate confirmation is a bad idea.
Of course the Journal is the financial industry’s ultimate apologist and comes to that conclusion from a completely different point of view than I do.
The president made the Harvard law professor a special adviser rather than the bureau’s first director in an attempt to circumvent a potentially difficult confirmation hearing.
The Journal fears that Warren will wield all of the power of the director without the financial industry having had a chance to block her appointment.
Wall Street’s concern is clear: What’s the point of spending millions on lobbyists and senators if you can’t use ’em when you need ’em to get your way.
My fear is that Warren will have a far more difficult time shaping the bureau than Obama expects because this end run around the Senate will allow the industry and its toadies to relentlessly question her legitimacy.
Every decision she makes will be challenged. Not based on its merits. But based on the fact that she made it.
Indeed, the Journal essentially launched that campaign Saturday with its editorial called “Elizabeth III.”
“A President with more political and Constitutional scruple would have nominated someone else,” the Journal wrote – and that’s exactly what the banking industry wants.
It will do whatever it takes to eliminate a strong consumer advocate like Warren making sure we are treated fairly by the financial industry. (A scary concept on Wall Street, where the ability to sell deceptive investments and bury fees in the fine print is a well entrenched way of doing business.)
This decision allows the banking industry and its helpers to assert as fact that Warren couldn’t pass a Senate nomination to be the bureau’s real director even though that is far from certain.
It was a risk worth taking, and a fight worth having, to ensure the new consumer protection bureau will be able to focus public attention right where it should be – on the banks.
Now, I’m afraid, the financial industry has a golden opportunity to make the conversation all about the legitimacy of the bureau’s leadership.
The potential is there for consumers to suffer once again.