Bucking GOP, Obama Will Recess Appoint Consumer Agency Chief

Jan 4, 2012

President Obama will use what's known as a recess appointment to name Richard Cordray the head of the country's new consumer watchdog agency.

White House spokesman Dan Pfeiffer announced the White House would be circumventing Senate approval via twitter, confirming the Associated Press' earlier story. Now, as the AP writes, this is a "display of executive power" that will most certainly "cause an uproar from Capitol Hill to Wall Street."

What's going on is that the Senate has scheduled a pro-forma session every third day. Under a Clinton-era Justice Department interpretation, the president can only make a recess appointment if the Senate is gone more than three days. The Hill published a great explainer piece today. What Obama announced today, reports The Hill, will break "20 years of precedent."

The AP adds that the decsion also amounts to calling the pro-forma sessions "a sham." The AP reports:

"The White House is expecting considerable criticism and perhaps a court challenge, but says Obama was left with little choice to get the consumer agency fully running after months of stalemate.

"Acting right after Tuesday's GOP presidential caucuses in Iowa, Obama is seeking to grab attention and show voters that he will advocate for the middle class no matter what the opposition. It is his most bare-knuckle initiative so far in his campaign of taking action without waiting for Congress.

"Obama planned to announce his decision later Wednesday during an economic event in Cordray's home state of Ohio, with Cordray along with him."

As Mark reported in December, Republicans in the Senate had banded together to block Cordray's appointment to the Consumer Financial Protection Bureau.

The agency was created as part of the Dodd-Frank financial regulation act. The president says it's intended to prevent another financial collapse by, among other things, policing predatory lending practices. As ABC News reported back in July, the fight with the Senate has been long, dating back to contentious hearings with Elizabeth Warren, who is running for a Senate seat now, but helped get the agency going.

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