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On the CFPB Nomination


It’s been 133 days since former Consumer Financial Protection Bureau (CFPB) Director Richard Cordray announced his resignation as the head of the agency to pursue a gubernatorial run in Ohio. Since that time, Mick Mulvaney, who holds a full-time, cabinet-level job as director of the Office of Management and Budget (OMB), has been serving as an interim, acting director of the Bureau. Earlier this week, after months of uncertainty and rumors regarding who he might put forward as a permanent CFPB director, President Donald Trump announced he had selected Kathy Kraninger – a relatively unknown aide to Mulvaney at OMB who nobody had on their betting slip – as his nominee.


The White House was under the gun to name a permanent head of the agency. Under the Federal Vacancies Reform Act, Mulvaney’s temporary appointment would have expired tomorrow, June 22, if the President Trump hadn’t sent to the Senate a nominee for a permanent replacement. Under that law, Mulvaney can continue to occupy his interim position at the CFPB until the Senate confirms Kraninger, however long that may take.

And it may indeed take some time for the Senate to act. On Tuesday, Sen. Elizabeth Warren (D-Mass.) announced her intention to put a hold on Kraninger’s nomination. (Nerdy political parlance definition: ahold allows a single senator to block a nomination or bill by simply telling the floor leader that he or she doesn’t want it to move. The majority leader doesn’t have to agree, but notice of a hold is a signal that the opposing senator intends to filibuster any motion to proceed to consider the nomination.)


The Kraninger recommendation is just the latest in a long line of executive and judicial branch nominations to be stalled by politics, or other matters unrelated to the individual’s own background.


Article II, Section 2 of the Constitution states the president “with the advice and consent of the Senate, shall appoint ambassadors, other public ministers and consuls, judges of the Supreme Court, and all other officers of the United States …” The Senate does not have to give its consent – it can choose not to act on a nomination or it can vote it down, or the president can make a recess appointment, which allows an appointee to temporarily fill the vacancy for which he or she was nominated without Senate confirmation – but for most of American history, the Senate approved White House nominees, traditionally deferring to a great extent to the Executive Branch, unless there were significant concerns about the nominee’s resume. That tradition was arguably upended in 1987 when the Democratic Senate voted 42-58 against confirming President Regan’s nominee, Robert Bork, to the Supreme Court in an ugly affair that saw Bork’s video rental history leaked in the press. And it’s gone downhill from then. (Justice Anthony Kennedy, a perennial swing vote on the Court, ultimately was nominated by Reagan and confirmed by the Senate.)


By 2001, Brookings Institution scholar Burdett Loomis noted, “Even noncontroversial nominations can fall victim to highly partisan Senate politics, as nominees are ‘held hostage’ to other nominations, to appropriations bills, or to substantive legislation.” At that point, there were about 30 holds on average annually on judicial and executive branch nominations. Though some believe holds are a less potent toolthan they were before a Democratic majority in the Senate reduced to a simple majority the number of votes needed to overcome filibusters for executive and non-Supreme Court judicial nominations in 2013, they’re still an important tool, as the Kraninger nomination shows.


In the tweet announcing her hold (because that’s how our policymakers put out official statements now), Sen. Warren mentioned Kraninger’s lack of ”track record of helping consumers,” but then cited the Trump administration’s policy of separating families unlawfully crossing the U.S.’s southern border as her rationale for seeking to block the nomination. The natural question, of course, is: why would Sen. Warren seek to tie Kraninger’s nomination to lead a consumer financial protection agency to immigration policy?


With public polling running about two to one against the administration’s family separation policy, which President Trump addressed by Executive Order yesterday, these questions are beneficial ones for Democrats to ask. Sen. Dean Heller (R-Nev.), arguably the most vulnerable sitting Republican U.S. senator running for reelection this year, sits on the panel. Latinos make up about 17 percent of the Nevada electorate and Heller has voiced his opposition to the administration’s former policy. Sen. Ben Sasse (R-Neb.) also sits on the banking panel and has been extraordinarily vocal in his opposition to the White House’s separation policy. With a 13-12 partisan balance on the committee, their support is essential to getting Kraninger before the full Senate. By tying Kraninger’s nomination to a deeply unpopular immigration policy, Sen. Warren has, effectively, boxed in one – and perhaps two – of her Republican colleagues on the Senate Banking Committee.


Further, with the absence of ailing Sen. John McCain (R-Ariz.), the tight 51-49 party split in the Senate means the GOP also cannot afford to lose a single vote if the Kraninger nomination makes it to the floor of the chamber for a confirmation vote. And there are plenty of Republicans off the Banking Committee asking the same questions Sens. Warren and Brown are about the family separation policy and whether Kraninger had any involvement in its formation or communication.


While this issue will unquestionably play a strong part in Kraninger’s nomination, it’s not the only issue she’s facing. Left-leaning groups already have come out strongly against Kraninger’s selection because, as the Los Angeles Times said, she has “no apparent relevant experience in finance, banking regulation or consumer protection.”

That claim is somewhat overstated. Prior to OMB, Kraninger was on Capitol Hill where her experience included working for Sen. Susan Collins (R-Maine), the former chair of the Senate Committee on Homeland Security and Governmental Affairs. Additionally, as a Wall Street Journal editorial noted, Kraninger was OMB’s associate director for “general government,” a post that oversees nearly a quarter trillion dollars in federal spending – including the budgets for all financial regulators – seven cabinet departments, and 30 agencies. But this is Washington, where, for better or worse, optics is reality.


The White House is telling its allies that it expects Kraninger to have a confirmation hearing before the Senate Banking Committee in July and a confirmation vote in the Senate in August. That is an awfully ambitious timetable. A more likely scenario sees Mick Mulvaney continuing on as Acting Director at the CFPB until at least the mid-term elections. Should the GOP keep the Senate, Kraninger’s confirmation could take place during a lame-duck session. If Democrats take hold of the chamber, all bets could be off.

#CFPB #WhiteHouse #US

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