The Glade 4.0

Whatever else can be said about this White House, it isn't afraid to poke a stick in the eye of its critics. How else to explain President Obama's decision Friday to put Elizabeth Warren in charge of the new Consumer Financial Protection Bureau while avoiding Senate confirmation and, for that matter, any political supervision.

The chutzpah here is something to behold. The pride of Harvard Law School, Ms. Warren is a hero to the political left for proposing a new bureaucracy to micromanage the services that banks can offer consumers. But she is also so politically controversial that no less a liberal lion than Connecticut Senator Chris Dodd has warned the White House that she probably isn't confirmable. A President with more political and Constitutional scruple would have nominated someone else. Mr. Obama's choice is to appoint her anyway and dare the Senate to do something about it.

The plan is for Ms. Warren to run the new bureau from an office at the Treasury Department. Instead of calling her the "Director" of the bureau—the statutory title for the organization's boss—Mr. Obama has appointed her an "assistant" to him and a "special advisor" to Treasury Secretary Timothy Geithner.

Mr. Geithner's supervision will be pro forma, however, because Ms. Warren rolled over him during the financial reform debate and has her own pipeline to the Oval Office. The President emphasized that Ms. Warren will enjoy "direct access" to him and said she would oversee all aspects of the creation of the new agency, including staffing and policy planning. For all intents and purposes, Ms. Warren will be Treasury Secretary for all consumer lending.

We would have thought a Harvard law professor would object to the extra-legality of this arrangement, but then this is also the crew that gave us ObamaCare via budget reconciliation and put Donald Berwick in charge of Medicare without a Senate debate. Remind us again why the tea party critique of Obama governance is crazy.

The new bureau was already destined to be a bureaucratic rogue. When Members of Congress objected to it being "independent" in the way Ms. Warren hoped, Mr. Dodd and the Administration cooked up a plan to make it part of the Federal Reserve without actually answering to anyone there. The bureau has independent rule-making authority and can grant itself an annual budget up to $646 million. It will draw this money from the operations of the Fed, so the bureau needn't deal with the messy intrusions of Congressional appropriators and will therefore receive limited Congressional oversight.

Ms. Warren's bureau will dictate how credit is allocated throughout the American economy—by banks and financial firms, and also by many small businesses that extend credit to consumers. The bureau's mandate under the new Dodd-Frank law is to ensure that "consumers are protected from unfair, deceptive, or abusive acts and practices and from discrimination." If those terms sound vague and overbroad now, wait until Ms. Warren's hand-picked staff begins interpreting existing laws on fair lending and writes new rules.

In a blog posting Friday on the White House website, Ms. Warren made her intentions clear enough: "President Obama understands the importance of leveling the playing field again for families and creating protections that work not just for the wealthy or connected, but for every American." Given the economic growth and jobless figures, maybe we should start calling this the "leveling" Administration.

Though her mandate goes beyond banks, the banking system is likely to suffer the most damage. Ms. Warren was a vociferous opponent of allowing regulators charged with maintaining the safety and soundness of banks to control this new bureau. No matter how destructive its new rules may be, they can only be rescinded by a two-thirds vote of the Administration's new Financial Stability Oversight Council.

And the bureau will now be staffed and shaped by an "assistant" with no obligation to appear before the Senate. The possibility that an appointed official could hold significant authority is why the framers wrote the Senate into the process of approving the President's senior hires. Article II, Section 2 of the Constitution says the President "shall nominate, and by and with the Advice and Consent of the Senate, shall appoint . . . Officers of the United States."

Article II, Section 2 also says "Congress may by Law vest the Appointment of such inferior Officers, as they think proper, in the President alone," but Congress explicitly did not view the head of the financial consumer bureau as an inferior officer. On July 21, Mr. Obama signed a bill passed by both Houses stating that the "Director shall be appointed by the President, by and with the advice and consent of the Senate."

We have here another end-run around Constitutional niceties so Team Obama can invest huge authority in an unelected official who is unable to withstand a public vetting. So a bureau inside an agency (the Fed) that it doesn't report to, with a budget not subject to Congressional control, now gets a leader not subject to Senate confirmation. If Dick Cheney had tried this, he'd have been accused of staging a coup.

Is this different really that different than all the other "policy czars" and "special advisors" Presidents have been using for the last few decades, though? Honest question. I get how this kind of moves the ball a bit further down the field toward a less accountable Executive, but it seems like just another step in that direction, not the unprecedented usurpation Republicans are claiming. Honestly, their reaction seems to be a replay of the "zomg, czars!" hyperventilating from last year.

Last I checked, czars, while extremely silly, were ultimately purely advisory. This seems to be a regulatory position.

19 Yet she became more and more promiscuous as she recalled the days of her youth, when she was a prostitute in Egypt. 20 There she lusted after her lovers, whose genitals were like those of donkeys and whose emission was like that of horses.

Yes, because the legislative branch is being compeletely circumvented. If President Obama fires someone, he needs to replace them, and their replacement needs to be confirmed by congress. It is a check on executive power.

19 Yet she became more and more promiscuous as she recalled the days of her youth, when she was a prostitute in Egypt. 20 There she lusted after her lovers, whose genitals were like those of donkeys and whose emission was like that of horses.

Congress has to confirm them in order for them to be a puppet.

I'm not sure why in this arrangement you think Geitner will even have a say, much less be the one that has to implement anything.

This new agency will mostly likely have complete reign on the mandated areas and make the decisions.

The only thing Geitner has to worry about is getting called before Congress to answer for the actions of a group within his department over which he has no control.

Obama cannot create what is essentially a new Cabinet position and hand them a staff, paying their salaries and giving them regulatory ability without involving Congress at all.

Obama cannot create what is essentially a new Cabinet position and hand them a staff, paying their salaries and giving them regulatory ability without involving Congress at all.

Facism is not a school of thought, it is a racial slur.

What consequences are there for Geithner, other than being fired by Obama, for refusing to do what Warren says? He's still the head of this department. Whoever Warren reports to is irrelevant. Geithner is the head of the Treasury department and the Treasury department does what he says, not what Warren says.

Obama cannot create what is essentially a new Cabinet position and hand them a staff, paying their salaries and giving them regulatory ability without involving Congress at all.

Alternately, budget the Bureau out of existence, since it has no Director and thus must not have anything to do to be directed.

The bureau [...] can grant itself an annual budget up to $646 million. It will draw this money from the operations of the Fed, so the bureau needn't deal with the messy intrusions of Congressional appropriators and will therefore receive limited Congressional oversight.

Is this different really that different than all the other "policy czars" and "special advisors" [...]

By appointing Warren in this manner Obama isn't really exhibiting any leverage that he didn't have before.

In addition to the explanations already given as to why this is different, I'll just point out that all you're saying here is that we should accept new abuses of power and constitutional loop-holes because old abuses of power and constitutional loop-holes still exist. I propose that we should eradicate both.