Republicans in Congress love to attack Elizabeth Warren, the White House aide overseeing the start-up of the new Consumer Financial Protection Bureau (CFPB). At a March 16 hearing, House GOPers used Warren as a “punching bag,” as one columnist put it, questioning her authority as the CFPB’s for-the-time-being leader and predicting the bureau’s imminent demise. None of those criticisms, however, compares to the pathetic accusation leveled by Reps. Spencer Bachus (R-Ala.) and Shelley Moore Capito (R-WV) in a letter (PDF) sent to Warren on Wednesday.
Bachus and Moore Capito accuse Warren of misleading Congress about the CFPB’s role in the negotiations over a proposed settlement for the mortgage servicing industry. The settlement—which has been savaged by Republicans, the Wall Street Journal‘s editorial page, and other conservatives—will likely demand that servicers fix their dysfunctional operations so that homeowners aren’t ripped off and improperly foreclosed on, an all-too-common occurrence. Warren told Congress that the CFPB offered advice on what the settlement should contain. But in their letter, Bachus and Moore Capito say Warren’s agency “did more than provide advice: it recommended the goals and provided a detailed framework for the structure of the settlement.” It’s a clear insinuation: you lied to us.
Really? According to Merriam-Webster Dictionary, the definition of “advice” is a “recommendation regarding a decision or course of conduct.” That is, to give advice is to recommend. Treasury Secretary Tim Geithner asked the bureau for advice about the proposed servicer settlement, and Warren and the CFPB did exactly that: they said what they thought the settlement should include. The “detailed framework” cited in Bachus and Moore Capito’s letter was nothing more than a 10-page PowerPoint presentation written by the bureau, laying out its advice. Nothing nefarious there.
The Bachus and Moore Capito letter goes on to say that the CFPB was in fact the “primary architect” of the mortgage servicing settlement. It’s a claim that is far from accurate. For starters, the mortgage servicing settlement is far from finished. How can Republicans accuse the CFPB of being the architect if the deal is still in the making? Perhaps Republicans are referring to the term sheet (PDF) released by Iowa attorney general Tom Miller, a Democrat, earlier this month, a rough guide to how the settlement might look. That draft was 27 pages long. And while it included ideas offered by the CFPB, it featured plenty that was not in the CFPB’s recommendations. To call the bureau the “primary architect” simply isn’t correct.
Even if the AGs’ draft and the CFPB’s recommendations aligned in several areas, that doesn’t mean Warren is secretly crafting the deal, as many on the right want to believe. It means the AGs took her advice.
Here is what’s really going on: With their letters and hearings, Republicans are trying to craft a narrative that makes Warren and the CFPB out to be the bad guy, an example of evil big government prying into the lives of ordinary Americans and eating up taxpayer money for no good reason. This spring, President Barack Obama is due to appoint the head of the CFPB, and Warren is presumably in contention for this slot. Consequently, Republicans are throwing everything they can at Warren to take her out of the running—or to prepare for a brutal confirmation process.
And it’s not just members of Congress. For weeks, the archconservative editorial page of the Wall Street Journal has attacked Warren, calling her a “czar” and accusing her of “extorting billions of dollars from private mortgage servicers” and “stalling a US housing market recovery.” Behind the WSJ‘s crusade against Warren reportedly is an editorial writer named Mary Kissel, who used to work for Goldman Sachs.
Warren, a consumer advocate and onetime bailout watchdog, remains the leading candidate for the job. The CFPB was, after all, her idea. She frightens not just Republicans but big banks and their fleets of lobbyists in Washington because she intends to rattle the status quo and pass reforms that will actually help working and middle class consumers. Bachus and Moore Capito’s letter is just the latest in a relentless campaign to tar Warren and prevent her from claiming a position that may belong to her more than anyone else.
Already one liberal group has mobilized in response to Bachus’ letter. On Wednesday evening, the Progressive Change Campaign Committee sent an email urging supporters to call Bachus’ office and tell the Alabama Republican to “Stop attacking Elizabeth Warren and stop being such a sell out for Wall Street.”