U.S. Senator Tim Johnson, chairman of the Banking Committee, said he opposes House Republican legislation that would supplant the director of the Consumer Financial Protection Bureau with a commission -- making it unlikely that such legislation could pass.
“This issue was already considered during the thorough Wall Street reform debate we had last year and agreement was reached that consumers would be protected best with a director in place at the CFPB,” Johnson, a South Dakota Democrat, said in an e-mail.
Representative Spencer Bachus, the Alabama Republican who is chairman of the House Financial Services Committee, introduced a bill last month that would replace the post of director with a five-member bipartisan commission. To become law, the legislation would likely have to be approved by Johnson’s committee and passed by a majority in the Senate, which is controlled by the Democrats.
The consumer bureau, which was created by the Dodd-Frank regulatory overhaul that President Barack Obama signed last year, is scheduled to begin work on July 21.
Senator Jerry Moran, a Kansas Republican, today said at a hearing of the Senate Appropriations Committee’s subcommittee on financial services, that he is preparing legislation similar to the Bachus bill. Treasury Secretary Timothy F. Geithner said at the same hearing he opposes the idea of a commission.
Congress considered a range of options and came up with a model “that combines very strong authority and independence, the necessary independence, with a set of powerful checks and balances,” Geithner said.
Elizabeth Warren, the Obama administration adviser in charge of setting up the bureau, hasn’t been publicly ruled out as possible nominee. Johnson called Warren “one of a number of excellent potential candidates.”
Warren got her current job in September after Senator Chris Dodd, the former banking committee chairman, said she couldn’t be confirmed as director. Johnson declined to speculate on whether she or anyone else could win Senate confirmation.
“I am eager for the White House to send us a nominee so we can quickly move forward with the conformation process, but I am not going to do a nose count until the administration signals to me who they are going to nominate,” Johnson said.
At the hearing, Geithner said he couldn’t answer when Obama would nominate someone, but said the administration was consulting with Congress.
“We want to nominate somebody who can be confirmed,” Geithner said. “And so that’s why it’s taking us a little bit of time.”
The Obama administration has sounded out the former Democratic governor of Michigan, Jennifer Granholm, and the former Democratic senator from Delaware, Ted Kaufman, about the consumer bureau job, Bloomberg News has reported, citing two people with knowledge of the discussions. Both officials declined.
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