Senate Democrats largely supported the idea of appointing Elizabeth Warren as the temporary head of the Consumer Financial Protection Bureau, with one key exception — Banking Committee Chairman Chris Dodd — who joined Republicans in arguing such a move would be a "mistake."
Democrats generally endorsed Warren's leadership on Tuesday, saying the White House should use any method possible to appoint her as leader of the consumer agency. American Banker reported Monday that the Obama administration is considering appointing Warren as temporary head of the agency, sidestepping a potentially bruising confirmation battle.
Republicans, meanwhile, insisted that the appointment should go through the traditional Senate confirmation process, which would require at least 60 votes to block a potential filibuster.
Dodd clearly agreed, arguing that the administration's idea sounded akin to a recess appointment.
"I'm just not in favor of recess appointments, except under the circumstances where it's called for," Dodd told reporters. "Otherwise, you are abusing the process, and I think it's a mistake — I don't care who the nominee is."
Warren's supporters have noted that the Dodd-Frank law enables the Treasury Secretary to appoint staff on an interim basis to get the CFPB up and running, and could be used to bring Warren on board. But Dodd said he never intended for the provision to be used in such a manner and circumvent the Senate confirmation process.
He said such a move could set a dangerous precedent for future administrations, and fatally compromise the agency down the road.
"I don't think we had quite this in mind," said the Connecticut Democrat. "I'm not enthusiastic about that and it think it would be met with a lot of opposition. It's a big job. It's an important job and it needs to be – you've got to build the support for that institutionally or the next Congress... You could gut this before it ever even gets off the ground."
Dodd warned lawmakers could seek to harm the CFPB through the appropriations process. It could "take away the money — that's how you always do it," he said.
Although Dodd denied his position was personal, he continued to sound unenthusiastic about a potential Warren nomination.
"I'm not going to get into the editorial comments about that," he said, responding to a question about whether an interim appointment would undermine her credibility. "It's up to the administration. When they tell me who they are going to send up I'll go to bat for them and try to help them get confirmed but I think we are playing games until then. They should decide what they want to do."
Although Dodd speculated that temporarily appointing Warren would "absolutely" generate a backlash in the Senate, only Republican members voiced strong opposition to the move.
At least two moderate Democrats ducked taking a position. Sen. Mark Warner of Virginia said only that he would "keep an open mind" on the idea and Sen. Ben Nelson of Nebraska said, "I'm not aware that she is going to be or not going to be so I'm not going to speculate on it."
Several other Democrats, however, said they would like to see Warren put in place as soon as possible and expressed no concerns about an interim appointment, including Sens. Byron Dorgan, Carl Levin, Sherrod Brown and Bernie Sanders (an Independent who caucuses with the Democrats.)
"I support getting her there however she gets there,' said Dorgan, a North Dakota lawmaker. "I think she'd be a great choice. She's strong and assertive and given what's happened in the financial industry in the last years I think it's important for us to have an agency with a head who knows what she is doing and is willing to be assertive. I support getting her there. I understand there is an ability to have her appointed by the Treasury secretary but then it's also confirmable."
He added that he was not sure whether she has enough support to win a confirmation battle.
"I don't know," he said. "She's very well qualified and I think would do a superb job."
Levin said he doubted there would be any backlash.
"I don't think there be a ‘backlash' that would last very long and however she can get there is something I would favor," said the Michigan lawmaker.
But Republicans, including moderate ones like Maine Sens. Susan Collins and Olympia Snowe, said they would view an interim appointment the same as a recess appointment, which they oppose.
Sen. Richard Shelby, R-Ala., the top GOP member on the Senate Banking Committee who opposed the underlying reform, said that skipping the confirmation process would be a poor decision by the White House.
"I think that's not a good idea," Shelby said. "You know that is raw politics, to appoint somebody to that position without having them vetted. A new position with possible awesome powers is not very wise. I know the president might do that. I would hope he would go through the regular order whoever he appoints."
Another Republican on the Senate Banking Committee, Sen. Mike Johanns, of Nebraska, said such a move by the White House would undermine the ability of senators to view Warren as a serious candidate for the position.
"If he does an interim appointment that would be terribly unfortunate – he lessens her credibility and he lessens his own," he said. "I don't know why he would want to consider that. I have been through the confirmation process as a member of the cabinet and it's a constitutional process. That's what the constitution envisioned and so I hope he will follow that."
Johanns said it's hard to predict where the votes would be.
"You never know. I never knew until I got the votes. You never know. But that's the whole purpose of this to subject that nominee to the advice and consent of the Senate."
This story has been reprinted with permission from American Banker.
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