Senate Republicans argue that the effort to confirm Richard Cordray as the director of the Consumer Financial Protection Bureau is a political stunt geared toward scoring rhetorical points.
Senate Democrats believe their push this week to confirm Richard Cordray to lead the Consumer Financial Protection Bureau will build momentum for their message that they are guardians of the middle class.
“We are going to increase the pressure to get the best vote possible,” a Senate Democratic leadership aide said Monday, arguing that any GOP “no” votes would enable Democrats to argue that Republicans were “pawns of the financial industry.”
“We think this is a bellwether vote to determine if you are on the side of consumers,” the aide said.
Senate Republicans argue the effort is a political stunt geared toward scoring rhetorical points rather than a genuine effort to get Cordray confirmed.
Democrats “have not reached out to Republicans to address our concerns,” including their unease with the amount of power given to the CFPB director under the Dodd-Frank financial regulation law, a Senate GOP leadership aide said.
Senate Democratic leaders have been in discussions with the White House on the nomination for about three weeks.
Senate Majority Leader Harry Reid (D-Nev.) is expected to move to cut off debate on the nomination today, which would set up a vote on Thursday.
It is unclear whether Democrats can win enough Republican votes to overcome a filibuster, which would require 60 votes.
Sen. Scott Brown (R-Mass.) supports Cordray. But 44 of the 47 GOP Senators earlier this year sent a letter to President Barack Obama expressing their concern over the CFPB director’s authority.
The Democratic aide said the move to confirm Cordray and to extend the payroll tax cut is part of the same effort to address income inequality, which Democrats believe will be a defining issue in the 2012 elections. Democrats argue that upper income earners have been the beneficiaries of GOP policies.
Senate Republican aides dismissed the notion that GOP policies favor the upper echelons of society and are anti-consumer.
“Republicans are trying to increase the accountability of a largely unaccountable agency,” a Senate GOP aide said. “I don’t think the [Democratic] argument holds water.”
On Sunday, the White House National Economic Council released a report arguing that a CFPB director is crucial to protect consumers.
“Without a director, the CFPB cannot fully supervise non-bank financial institutions such as independent payday lenders, non-bank mortgage lenders, non-bank mortgage servicers, debt collectors, credit reporting agencies and private student lenders,” the report said.
For example, “some studies have found that payday lenders on average charge fees of roughly $16 for a $100 two-week loan,” the report said. “This translates into an annual percentage rate of roughly 400 percent for borrowers often already struggling with debt. The fact that the CFPB cannot currently supervise payday lenders creates a serious regulatory gap that puts consumers at substantial risk.”
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