Elizabeth Warren Out at CFPB?

Bloomberg says Obama’s eliminated Elizabeth Warren as a choice to head the CFPB. Wall Street Journal says something less definitive. No confirmation from other sources. No word on who the choice to head the new organization might be, if not Warren.

This will be another litmus test for Obama’s commitment to doing what he can do – relatively easily – for the people of this country and also (perhaps especially) for the progressive movement which got him elected. As I’ve mentioned before, the GOP’s true opposition here is to the CFPB itself, to its very charter, and even more to the fact that as it is presently constituted under the Dodd-Frank financial reform bill, the CFPB is housed within the federal reserve. This means that congressional ability to “oversee” (read: hobble) it is almost nonexistent.

The GOP will oppose ANY nominee who isn’t an outright tool of the bankers, because, once confirmed, whoever is chosen to head the CFPB will have more-or-less free rein to protect consumers. That’s what the GOP (and their string-pullers at the major financial institutions) truly fear/despise, and what they wish to prevent more than anything else. So while it’s true that they oppose Warren’s nomination on those grounds (because there’s no question she would be a fierce advocate for consumers), it’s critical to understand that this is NOT, and has never been, a fight about the personality of Elizabeth Warren herself. Throwing Elizabeth Warren to the wolves (or under the bus) will NOT stop the GOP from strongly opposing ANY nominee whom the even suspect of being pro-consumer…unless they also win the ability to “oversee” the budget and operations of the CFPB in congress.

And that is why, if this Bloomberg story is true and it is Obama who has passed over Elizabeth Warren (as opposed to Warren not wanting the job), it will be impossible for his supporters to claim that this was the best deal Obama could get, or the best outcome possible. There is no one better to head the CFPB than the woman who set up, and whose idea the entire thing was in the first place. None. And Barack Obama can (and still should) recess-appoint her. If he does not, it will be quite clear that he never wanted her as head of the CFPB to begin with. There will be no fig-leaf of “well, he had to take the best deal he could” for either Obama – or the people who still insist he can do no wrong – to hide behind.