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Obama Sidesteps Congress on Consumer Pick and GOP Cries Foul

Manuel Balce Ceneta/Associated Press
President Barack Obama announces the nomination of former Ohio Attorney General Richard Cordray to serve as the first director of the Consumer Financial Protection Bureau in July.

McConnell ripped Obama’s move as having “arrogantly circumvented the American people by ‘recess’ appointing Richard Cordray,” and contended that the Senate was not in recess. Explaining that presidents have traditionally waited until the Senate has been in recess for 10 days or longer before using their recess appointment powers, McConnell said breaking from that precedent “lands this appointee in uncertain legal territory, threatens the confirmation process and fundamentally endangers the Congress’ role in providing a check on the excesses of the executive branch.”

Speaker John Boehner (R-Ohio) went further, predicting the courts would “find the appointment to be illegitimate.”

“This is an extraordinary and entirely unprecedented power grab by President Obama that defies centuries of practice and the legal advice of his own Justice Department,” Boehner said in a statement. “The precedent that would be set by this cavalier action would have a devastating effect on the checks and balances that are enshrined in our constitution.”

Pfeiffer, however, said Obama has the authority to make recess appointments. He called the Senate’s pro forma sessions a “gimmick” and cited President George W. Bush’s legal advisers contending that those “sham” sessions cannot be used to prevent a recess appointment.

Cordray’s nomination was defeated last month when the Senate failed to beat back a Republican-led filibuster. At the time, the GOP cited three things it required to confirm any CFPB director. The criteria included replacing the single director with a board because Republicans believe the director has too much power under the agency’s current design. They prefer a board to run the CFPB like the five-member board that runs the Securities and Exchange Commission.

Republicans also cite their concern that the CFPB should be funded through the appropriations process, which would give Congress more input over the agency. Currently, the CFPB is funded through the Federal Reserve System. Finally, they want to allow other financial regulators to provide a check on CFPB rules so they don’t imperil the health of financial institutions and lead to unnecessary bank failures.

Those demands were outlined earlier this year when a group of 44 Senate Republicans wrote a letter stating their intent to oppose any CFPB nominee until the changes to the law were made.

Senate Finance Committee ranking member Orrin Hatch (R-Utah), one of the signatories, warned that the move could come back to haunt the White House.

“This is a very grave decision by this heavy-handed, autocratic White House,” Hatch said. “Circumventing the Senate and tossing out decades of precedent to appoint an unaccountable czar to appease its liberal base is beneath the Office of the President. The legislative branch exists as a check and a balance on the Executive. By opening this door, the White House is saying it can appoint any person at any time to any position it chooses without the advice and consent of the Senate. This is not how our Republic was designed to function. The American people deserve to be treated with more respect than this White House is affording them with this blatant power grab. Senators of both parties should be deeply troubled [by] the president’s actions today — actions which will come back to haunt them. ”

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