Obama Unlikely to Get Opportunity to Appoint Cordray in Recess

Lawmakers seeking to wrap up congressional work for the year likely will leave Washington this month without giving President Barack Obama the opportunity to make a temporary appointment of his nominee to head the new Consumer Financial Protection Bureau.

After the U.S. Senate blocked the nomination of Richard Cordray to be the first director of the bureau following months of partisan acrimony, Obama said he won’t “take any options off the table” to put him in the post.

While presidents have the power to make temporary, or recess, appointments without lawmakers’ approval after Congress has formally adjourned, congressional aides in both parties say they don’t expect Obama will get that chance.

Don Stewart, a spokesman for Senate Minority Leader Mitch McConnell, said Majority Leader Harry Reid has kept the Senate in session on a pro-forma basis during recesses throughout the year. He anticipates the Nevada Democrat will do so again at year’s end.

“The Congress hasn’t been in recess all year, and we don’t expect we will be,” Stewart said.

Two Senate Democratic leadership aides who spoke on condition of anonymity said Reid is unlikely to end the practice of pro-forma sessions while lawmakers are back in their states until January. A single senator can be on hand to invoke the pro-forma session.

Republican Obstruction

Reid’s willingness to allow pro-forma sessions has forestalled Republican obstruction to other appointees and legislation in a chamber where Republicans have enough seats to block action through procedural votes.

Republicans who control the House also could reject any resolution adjourning the session even if Senate Democrats sought to approve it.

“We haven’t adjourned in quite a while, and I don’t expect that to change,” said Mike Steel, a spokesman for House Speaker John Boehner, an Ohio Republican.

Obama nominated Cordray, a former Ohio attorney general, to be the new consumer bureau’s director in July. That was about a year after he signed the Dodd-Frank financial regulatory overhaul that created the bureau.

The partisan dispute over Cordray’s nomination centered on Republican demands that changes be made in the structure and funding of the agency. In May, 44 Senate Republicans pledged to oppose any nominee for the director’s post without those changes. Senator Dean Heller of Nevada subsequently joined those vowing to oppose any appointee. Republicans hold 47 Senate seats, and it takes 60 votes to shut down debate and proceed to a vote.

‘We’ve Made Ours’

“The president has made his decision and we’ve made ours,” McConnell, of Kentucky, said on the Senate floor before the chamber’s Dec. 8 vote blocking Cordray’s nomination.

Reid has said minority opposition to a nominee based on rejection of a federal agency, and not concerns over a nominee’s capabilities, is unprecedented.

Obama has made the confirmation of Cordray a top priority and orchestrated a campaign of briefings, television interviews and speeches before the Senate vote to push the nomination. The consumer protection agency also has been part of the populist theme he has adopted ahead of next year’s presidential elections.

Republicans’ refusal to confirm Cordray “doesn’t make any sense,” Obama said on Dec. 8. “We either have a country where everybody fends for themselves, or we create a country where everybody does their fair share, everybody has got a fair chance, and we ensure that there’s fair play out there.”

Regulation Powers

Without a confirmed director, the consumer bureau can’t use key powers accorded it under the Dodd-Frank law, notably the ability to regulate non-bank financial institutions such as mortgage originators and payday lenders.

Treasury Secretary Timothy Geithner said in a statement that “Americans deserve the full protections signed into law under Wall Street reform. The longer the Senate fails to confirm Richard Cordray to lead the Consumer Financial Protection Bureau, the longer they will be denied that protection.”

Under the Constitution, neither chamber can adjourn for more than three days without the other’s permission, said David Eric Lewis, a political science professor at Vanderbilt University in Nashville. While the president has the ability to intervene and adjourn Congress on his own if both chambers disagree on whether or not to adjourn, that power has never been utilized, he said.

Obama used his recess authority in July 2010 to appoint Donald Berwick as administrator of the Centers for Medicare and Medicaid Services, the agency that handles the health programs for the elderly and low-income Americans. Republicans held fast on their objections to Berwick and he resigned, effective Dec. 2. The president has nominated Berwick’s chief deputy, Marilyn Tavenner, to replace him.

He also used recess appointments in March and December 2010 to fill posts that had been vacant for months because of Senate roadblocks, including putting two career foreign-service officers in as ambassadors to Syria and Turkey.

To contact the reporters on this story: Laura Litvan in Washington at llitvan@bloomberg.net; Carter Dougherty in Washington at cdougherty6@bloomberg.net

To contact the editor responsible for this story: Mark Silva at msilva34@bloomberg.net

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