Elizabeth Warren knows she’s got a tough job ahead of her as the chief architect in constructing the Consumer Financial Protection Bureau (CFPB). In comments during a panel discussion at Fortune’s Most Powerful Women conference in Washington in October, Warren said “all the different folks” in the financial services industry as well as American consumers “are trying to figure out what it means” that she’s been appointed Assistant to the President and Special Advisor to the Secretary of the Treasury on the CFPB.
This agency, she continued, “was formed notwithstanding the fact that the most powerful lobbying group in Washington said they would kill” it. “Yet, here it is,” she said, “a significant part of the president’s financial reform effort.” She said her hope is that the agency can “give literally millions of American families better tools to assess financial products’ costs and compare financial products.”
Warren’s ability to perform may be significantly hampered if Republicans take control of the House after the mid-term elections. Republicans have voiced great concerns about the CFPB and its “broad grant of authority” as well as Warren’s new role as chief architect. Treasury Secretary Timothy Geithner assured lawmakers during testimony before the House Financial Services Committee in early October, that President Obama will nominate a director to head the CFPB—and will not circumvent a Senate confirmation for that post. Rep. Spencer Bachus, R-Ala., ranking GOP member on the House Financial Services Committee (who would likely be the next chairman of the Committee if Republicans take control), however, told Geithner during the hearing that he believed the CFPB is the “most powerful agency to be formed in the last 30 years” because it has been given the authority to allocate credit and set fees.
He voiced his concerns to Geithner that Warren would be given executive privilege and therefore not have to testify before Congress. Rep. Barney Frank, D-Mass., chairman of the House Financial Services Committee, added that while he supports Warren in her new post, he, too, “would be very unhappy if there were any obstacles to Warren testifying” before Congress.
Geithner replied that the president would not circumvent a Senate confirmation, and will nominate a director for the CFPB. He added: “It is my expectation that she [Warren] would be happy to testify as to her duties at the Treasury” on the initial design of the agency.