See my UPDATE below based on a comment by washunate.
Apparently unlike everyone else reporting and blogging about the potential interim appointment of Elizabeth Warren to head the newly created Consumer Bureau, I actually took the time to read the relevant provisions of Dodd-Frank. There is no such provision. Dodd-Frank authorizes the Treasury Secretary to perform certain, limited functions of the Bureau, but it does not authorize him to appoint an "interim head." It does not authorize the Secretary to act as the Bureau Director, except in limited functions. It does not authorize the Secretary to appoint a Deputy Director, either. One provision of Dodd-Frank does, however, authorize an appointed, Senate-confirmed Director to appoint a Deputy Director who may act as Director in the absence or unavailability of the Director. And it is likely this provision -- and a misreading of the rest -- that has caused the stir about a potential interim appointment which the Act simply doesn't authorize.
But don't take my word for it. Let me walk you through the Act.
A pdf of the Act can be found (from the Government Printing Office website) here (2167 KB). Section 1066, titled "Interim Authority of the Secretary," of Subtitle F provides:
(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.
As noted, the just-quoted section is part of Subtitle F which consists of the following administrative provisions:
Subtitle F—Transfer of Functions and Personnel; Transitional Provisions
Sec. 1061. Transfer of consumer financial protection functions.
Sec. 1062. Designated transfer date.
Sec. 1063. Savings provisions.
Sec. 1064. Transfer of certain personnel.
Sec. 1065. Incidental transfers.
Sec. 1066. Interim authority of the Secretary.
Sec. 1067. Transition oversight.
The Bureau's substantive powers are not part of Subtitle F. Those are found in Subtitle A (which establishes the Bureau and enumerates its "executive and administrative powers"); Subtitle B (titled "General Powers of the Bureau"); Subtitle C ("Specific Bureau Authorities"); Subtitle E ("Enforcement Powers"). (Subtitles D, G and H are technical provisions.)
The assumption apparently underlying all the mis-reporting is that the Secretary can, under the authorization of section 1066, appoint a Deputy Director who can act as Director until a Director is appointed by the President and confirmed by the Senate. A Director of the Bureau (appointed by the President and confirmed by the Senate) certainly has the authority to appoint a Deputy Director who may act as the acting Director in the Director's absence or unavailability. So the Secretary must have that same power under section 1066, right? Wrong. A Director's authority to appoint a Deputy Director is found in Section 1011(b) of Subtitle A -- and thus not part of the Subtitle F "interim authority" granted to the Treasury Secretary.
Section 1011. ESTABLISHMENT OF THE BUREAU OF CONSUMER FINANCIAL PROTECTION.
***
(b) DIRECTOR AND DEPUTY DIRECTOR.—
(1) IN GENERAL.—There is established the position of the Director, who shall serve as the head of the Bureau.
(2) APPOINTMENT.—Subject to paragraph (3), the Director shall be appointed by the President, by and with the advice and consent of the Senate.
(3) QUALIFICATION.—The President shall nominate the Director from among individuals who are citizens of the United States.
(4) COMPENSATION.—The Director shall be compensated at
the rate prescribed for level II of the Executive Schedule under section 5313 of title 5, United States Code.
(5) DEPUTY DIRECTOR.—There is established the position of Deputy Director, who shall—
(A) be appointed by the Director; and
(B) serve as acting Director in the absence or unavailability of the Director
.
Subtitle A—Bureau of Consumer Financial Protection
Sec. 1011. Establishment of the Bureau of Consumer Financial Protection.
Sec. 1012. Executive and administrative powers.
Sec. 1013. Administration.
Sec. 1014. Consumer Advisory Board.
Sec. 1015. Coordination.
Sec. 1016. Appearances before and reports to Congress.
Sec. 1017. Funding; penalties and fines.
Sec. 1018. Effective date.
The Act does not grant the Treasury Secretary all of the powers of the Director. It grants the Secretary the limited authority to perform "the functions of the Bureau" under Subtitle F. That's it: Subtitle F authority. No Subtitle A authority to appoint a Deputy Director. No Subtitle B, C or E powers, either. This is a relatively simple exercise in statutory construction that every law student should be able to do correctly by the end of the first semester of law school. Heck, it's not rocket science. In this case, it should be clear to any layperson that Geithner isn't authorized to appoint an "interim head" of the Bureau.
I am an attorney who has had the privilege once in my career of working with Elizabeth Warren, and I believe based on that experience, plus what I've seen of her in the news in the last year or so, that she would be a terrific first Director of the Bureau. I would be absolutely dumbfounded if she would let the Administration pull the colossally bone-headed gaffe of trying to give her an "interim" appointment under this Act she had such a large hand in drafting and which simply contains no such "interim" appointment provision. I predict she will either be a recess appointment or a straight-up appointment requiring Senate confirmation.
I hate to be the one to rain on this parade, but I think the hullabaloo over her "interim appointment" is based on a misreading of the statute, and any news organization who reports on it will have egg on its face. Way to go, Fox News! (And, oh yeah, even though Dodd is right that the statute bearing his name has no "interim appointment" provision, he's still a horse's ass!)
UPDATE: washunate makes a very compelling point below in the comments. The point is that all of the powers and functions transferred from other agencies to the Bureau would lie dormant during the interim, until a Director is confirmed by the Senate. I agree that this can't be the case (although if Republicans think of it, it wouldn't be the wackiest thing they've advocated this year). So the Secretary likely does have the authority to enforce existing regulation and undertake existing functions transferred to the Bureau from other agencies. This still means, however, that if Geithner hired Warren to carry out his Subtitle F functions during the interim, she wouldn't be able to adopt new regulations or carry out any of the functions granted to the Bureau in Subtitles A, B, C and E of Dodd-Frank. The power she would have would be what already exists in other agencies, which is nothing to sneeze at. But she would lack the new powers granted to a Director of the Bureau, and that's no small caveat, either, unfortunately.
