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View Diary: It's Geithner's CFPB! Naked Cap: Warren's Being Sidelined (update) (213 comments)

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  •  Yves Smith is being ridiculous and does not know (19+ / 0-)

    what she is talking about on this issue.

    First, she's jumping the gun. We won't know the exact nature of Elizabeth Warren's appointment unti the announcement has been made.

    Second, and more importantly, based on the reports that are out, it appears that Obama is doing everything he can under the Dodd-Frank Wall Street Reform and Consumer Protection Act to give her as much authority over the CFPB as possible as soon as possible.

    Section 1011(b)(2) of the Act provides in relevant part:

    [T]he Director shall be appointed by the President, by and with the advice and consent of the Senate...

    It has been misreported that the President has the authority to appoint an interim Director, when, in fact, the President's authority is much more limited.

    The only interim authority provided in the Act with respect to the CFPB is set forth in Subtitle F, which is entitled "Transfer of Functions and Personnel; Transitional Provisions."

    That interim authority is provided in Section 1066 of Subtitle F:

    SEC. 1066. INTERIM AUTHORITY OF THE SECRETARY.

    (a) IN GENERAL.—The Secretary is authorized to perform the functions of the Bureau under this subtitle until the Director of the Bureau is confirmed by the Senate in accordance with section 1011.

    (b) INTERIM ADMINISTRATIVE SERVICES BY THE DEPARTMENT
    OF THE TREASURY.—The Department of the Treasury may provide administrative services necessary to support the Bureau before the designated transfer date.

    In other words the Treasury Secretary is authorized to perform functions having to do with setting up the department until such time as a Director of the Bureau has been nominated by the President and approved by the Senate.

    So the only way Obama can get Warren started right away is to make her a special advisor to the Treasury Secretary.

    But Yves Smith heard somewhere that "[t]echnically, [the President] could bypass confirmation altogether and have Warren as de facto leader of the agency, and never name a permanent director."  So, she goes ahead and accuses the President of acting in bad faith and trying to "keep her in orbit through mid-terms to prevent a hissy fit from her many fans, then name a more bank friendly permanent director."

    These accusations are baseless, reckless, uninformed, stupid and deeply unfair.  Next time Yves Smith wants to accuse the President of deceiving the public, she ought to spend at least 5 minutes finding out what the facts are.

    "Hope 2010 feels a lot different than Hope 2008. Tougher, deeper, more dearly bought." Femlaw, Hope 2010, September 8, 2010.

    by seanwright on Wed Sep 15, 2010 at 11:03:02 PM PDT

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