The takeaway from this afternoon's hearing of the House Oversight Subcommittee on TARP, Financial Services and Bailouts? Republicans don't like the Consumer Financial Protection Bureau, and they really don't like it's leader, Elizabeth Warren.
Subcommittee Chairman Patrick McHenry, a Republican from North Carolina, billed the hearing as an attempt to "watch the watchdogs," citing the bureau's involvement in ongoing settlement negotiations between regulators and state attorneys general. Indeed, in a segment this morning on CNBC, McHenry directly accused Warren of dishonesty about her involvement: "She insists on simply being an adviser to the president and the Treasury Secretary, and it seems as though she and her agency have been acting beyond the scope and the power they’ve been given."
Unfortunately for McHenry's allegations, there isn't any actual evidence of misconduct by Warren or the CFPB, and that became abundantly clear during the hearing, as Republicans repeatedly accused Warren of overstepping the bounds of her position -- and thus lying to Congress about her role -- without presenting anything resembling proof. Instead, Republican members attempted to define the word "advise" as everything except actions taken by Warren in her capacity as special adviser.
In addition, Republicans criticized Warren and the CFPB for what they saw as discrepancies between the agency and the rest of the federal government. Rep. Ann Marie Buerkle of New York, for example, pointed out the disparate salaries of bank regulators when compared to other federal workers: "The starting salary is $70,000, top salary is $140,000. Why are these folks getting paid much more than someone else in the federal government?" Warren tried to explain the rationale behind the pay scale -- regulatory agencies need to be competitive with banks to recruit the best talent -- but Buerkle wouldn't have it and offered vague insinuations of misconduct as a response: "This is the government, not the private sector, and this regulatory agency needs to answer for a huge disparity regarding the federal jobs and these positions."
Democratic members, on the other hand, were there to offer kind words for Warren -- in particular, Rep. Elijah Cummings of Maryland noted the huge cash disparity between the CFPB and the banks it's meant to regulate -- but on the whole, this hearing was clearly a Republican attempt to impugn and discredit Warren as an advocate for consumer protection. Of course, you could almost read this as a good thing; as Rep. John Yarmuth of Kentucky pointed out, Warren clearly scares banks (and their Republican allies), hence the vehemence and ridiculousness of their attacks.
One last observation. I wouldn't be surprised if the Obama administration refers to this (and other hearings) if it decides to appoint Warren during the congressional recess. Republican attacks on consumer advocates may play well with bankers and Tea Partiers, but they look terrible to the millions of Americans plagued by unfair fees and byzantine contracts. If the administration is interested in giving Warren a recess appointment, it will certainly help to have a clear record of hostility and intransigent opposition from Republicans.
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