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“Director” Richard Cordray, President Obama Flexes his Muscles, and a Recessed Congress

Posted in Consumer Protection

The American consumer could not have asked for a better holiday gift to begin the New Year.

As the election nears, President Obama is flexing his muscles.

The campaign slogan way back when of “hope and bipartisanship” could not have been more inspiring—or more idealistic, but governing has been tough, particularly given a Republican attitude of “no compromises, no backing down, no deals.”  While the President has not fared well at hardball—a game he was not born to play—he has signaled a renewed and reinvigorated willingness—fueled by the upcoming election no doubt—to step up from his game of compromise and conciliation.  Knowing Republicans would block the nomination, the President has named named Richard Cordray, a 2011 Corporate Observer All-American, head of the Consumer Financial Protection Board during Congress’ recess.

Thank goodness.  The CFPB has been crippled without a head.  It is a centerpiece of the much-needed Dodd-Frank legislation.  Appointing Mr. Cordray will allow the CFPB to begin the work of regulating a fast moving and dynamic sector that to date has remained one step ahead of regulators.  Mr. Cordray is surely qualified—he clerked for Supreme Court Justices White and Kennedy, served as Attorney General of Ohio, and even won Jeopardy five times.  One of his main initiatives will be to deploy the Volcker Rule, in spirit if not name.  Mr. Cordray has promised to expand the Board’s regulatory activities to the non-bank realm.  Many of these under- or unregulated firms are the root of the greedy risk-taking that helped cause the financial crisis.

There is a long checklist waiting on Mr. Cordray’s desk, but for now, it’s about time Mr. President and good luck Director Cordray.  The American consumer could not have asked for a better holiday gift to begin the New Year.


Assisted by David T. Martin