Using Recess Appointment, Obama Names Cordray as CFPB Head

By Zoe Tillman and Jenna Greene

Updated at 5:47 p.m.

President Barack Obama announced four recess appointments today, including Richard Cordray as head of the Consumer Financial Protection Bureau. The move was a challenge Senate Republicans who last month blocked a vote on Cordray's bid and have argued against the president's legal authority to make such appointments.

Cordray was Obama's pick to lead the agency in July. The Senate Committee on Banking, Housing and Urban Affairs voted to approve the nomination in October, but he faced stiff resistance from Senate Republicans, who had vowed to block the confirmation of any director back in May. Last month, the Senate voted 53 to 45 to block a vote on his confirmation from proceeding.

Cordray – currently the agency's head of enforcement – is the former Ohio attorney general, and spent most of his career in the state. Obama spoke today at a high school outside Cleveland.

“I nominated Richard for this job last summer. And yet, for almost half a year, Republicans in the Senate have blocked his confirmation … The only reason Republicans in the Senate have blocked Richard is because they don’t agree with the law setting up the consumer watchdog. They want to weaken it,” Obama said in his prepared remarks.

The White House also announced three recess appointments to the National Labor Relations Board later in the afternoon. The appointees are Sharon Block, the deputy assistant secretary for congressional affairs at the U.S. Department of Labor; Terence Flynn, who is currently detailed to serve as chief counsel to board member Brian Hayes; and Richard Griffin, the general counsel for International Union of Operating Engineers.

Republicans have challenged the president’s legal authority to make recess appointments without waiting for Congress to be fully out of session for 10 days, as has been the precedent. As reported by Politico earlier this week, Republican leaders have been opening session for a few minutes every couple of days during the winter recess and argue that should preclude any recess appointments.

Groups on the political left praised the news of Cordray’s appointment, issuing statements Wednesday morning applauding the president’s decision.

Public Citizen, a consumer advocacy organization in Washington, defended Obama’s authority to make the appointment. “Some Republicans are claiming that the president lacked authority to make a recess appointment. They are wrong. The Senate is effectively on a five-week recess,” the group wrote in a statement. “Whether the current recess is viewed as five weeks or three days long, it is long enough.”

Alliance for Justice President Nan Aron also praised the move and called for an end to “the practice of incessant obstruction and delay” for all presidential nominees. “The President's action today should not have been necessary, but it was precipitated by months of unremitting obstruction,” Aron said.

The U.S. Chamber of Commerce, on the other hand, which has challenged the creation of the agency under the Dodd-Frank law overhauling the financial services sector, called the decision “unprecedented” and “constitutionally questionable.”

“The President had a choice to work with Congress to implement the necessary reforms for this agency. Instead, he chose a political maneuver that ignores the advice and consent power of the Senate, harms consumers, and ensures that the CFPB’s authority will be challenged and resolved by the courts,” Chamber President and CEO Thomas Donohue said in a statement.

The CFPB was created as part of Dodd-Frank, and officially opened its doors in July. The bureau was the brainchild of Harvard Law School professor Elizabeth Warren, who spent the past year organizing it, and who recruited Cordray to serve as director of enforcement. But she was a polarizing figure who triggered fierce opposition from the banking industry, and in July, Obama nominated Cordray instead to serve as the agency's first director.

Without a director, the agency is hamstrung by wording in Dodd-Frank from fully carrying out its mission to police the murky world of non-bank lenders. Republicans opposed to the agency's existence in the first place have had little incentive to move any nomination through Congress, instead demanding the agency be restructured with a board of directors.

National Law Journal photo by Diego M. Radzinschi.

Comments

[Adamakis]

""In 2008 candidate Barack Obama said: “This is part of the whole theory of George Bush that he can make laws as he is going along. I disagree with that. I taught the Constitution for 10 years. ... We are not going to use signing statements as a way of doing an end run around Congress.

Now…about signing statements – he recently used one to ignore about 20 provisions of the omnibus spending bill…doing precisely what he criticized George Bush for doing:
"I refuse to take 'No' for an answer… when Congress refuses to act in a way that hurts our economy and puts people at risk, I have an obligation as president to do what I can without them.”"---ChicagoTribune.com

[Sidney Gendin]

Cordray is talented and qualified but Obama insulted Warren by not appointing her. Obama has no relish for a good fight. He would not only have had to fight the Senate but Geithner and Summers. "Spunk" is not his middle name.

[bob]

Those unhappy can blame the political question doctrine, which makes such executive actions effectively unchallengeable.

[Sean Hackbarth]

CORRECTION: Republicans have not been periodically opening sessions in the Senate because they aren't in the majority and don't have control.

[Joe Jefferis]

Ohio voters fired Cordray in 2010.

[Carmen Leslie]

This move is another "power grab' by Mr. Obama. He's already refused to abide by the US Constitution's "separation" of Powers", so why should this move be new?
Peron and a few others did the same to gain "control" over their peoples.
They also practiced the "them against us" policy.
Don't Cry for Me, AMERICA.

[JS]

It's about time the president acted to challenge the obstructionist tactics that have denied him the appointment power.