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Report: Economic Team Wanted No Part of Warren Nomination for CFPB

It’s dawning on people that Richard Cordray has no better chance of being confirmed by the Senate to the position of Director of the Consumer Financial Protection Bureau as Elizabeth Warren did. Not only do we have the plain words of 44 Republicans in the Senate, enough to filibuster the nomination, but we have the evidence of Republicans blocking maybe hundreds of other Presidential appointments, from Peter Diamond to Don Berwick to John Bryson. I agree with Jon Cohn that this is unprecedented.

What makes this ideological policing even more pernicious is the fact that it’s policing by a minority. The formal letter threatening to block consumer board appointments includes 44 Republican senators, less than a majority but enough to block nomination with filibuster. If the Senate still operated by majority rule, Berwick, Bryson, Diamond, and Warren would likely be busy running their agencies right now. Instead, they are serving as lame duck recess appointees — or not serving at all.

Just to be sure, I consulted Thomas Mann, the political scholar at Brookings known for his encyclopedic knowledge of congressional history. Here’s what he said:

In the case of the Consumer Protection Board, Senate Republicans have said they would not confirm anyone who does not agree to restructure the leadership of the agency from a single person to a multi-member body. They insist that a legitimately passed law be changed before allowing it to function with a director – a modern-day form of nullification. Same with the director of the Center for Medicare and Medicaid Services. There is nothing normal or routine about this. The Senate policing of non-cabinet appointments is sometimes more aggressive but the current practice goes well beyond that, more like pre-Civil War days than 20th century practice.

If that’s the case, and if nobody will become Director of the CFPB without a recess appointment, then what is the difference between nominating Warren and nominating Cordray? That is the question that a lot of people on the progressive side have, and Shahien Nasiripour begins to answer it with this report. The Republican opposition to CFPB is real, and should be fought. But that shouldn’t allow us to neglect the very real opposition to Warren from inside the White House.

The internal debate that led to President Barack Obama passing her over as head of the agency, commonly known as the CFPB, pitted one set of advisers — longtime confidantes Valerie Jarrett and David Axelrod — against the trio of Treasury Secretary Timothy Geithner, former White House Chief of Staff Rahm Emanuel, and current Chief of Staff William Daley.

Jarrett and Axelrod supported Warren, not least because of the impact she’d have on the Democratic Party’s liberal base, sources said. Geithner, Emanuel and Daley opposed the idea because of a variety of factors, both personal and political.

Ultimately, it was Obama’s call. Sources said an anecdote about a 2010 meeting provides clues to Obama’s thinking.

Last summer, during a White House meeting with first-term Senate Democrats, Sen. Bernie Sanders, an independent from Vermont, asked Obama whether he’d nominate Warren for the role.

Obama held up a half-full glass of water and told him: “That’s the problem with you progressives. You see this as half-empty.”

I think the most telling part of that comment is “you progressives,” no?

Nasiripour renders a tale that I’ve heard before about Ben Nelson getting assurances that Warren would never become the head of CFPB, as a condition of his vote for Dodd-Frank. Nelson denies it, and so does the White House. But Nasiripour maintains that Emanuel and Daley and Geithner were flat opposed. The fact that she didn’t get the job, even though she was able to bargain for a top lieutenant to get it, tells us a bit about how the infighting played out.

Warren played good soldier here. She clearly wanted the job, but wasn’t willing to wound the agency over it. So she got what she could and moved on, promising to fight anyone seeking to topple the agency from whatever perch she has. Republicans have absolutely tried to gut CFPB. And they should be called on it. But that doesn’t mean that the White House gets a free pass.

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David Dayen

David Dayen