U.S. Bulletin: Warren Named U.S. Treasury Special Advisor

Although U.S. “mid-term,” elections dominated the American media for most of this season, a relatively poignant development occurred in American governance just before the 2010 elections.  On September 17, 2010, President Obama announced Elizabeth Warren as Assistant to the President and Special Advisor to the Secretary of the Treasury on the Consumer Financial Protection Bureau.  Some speculated this move to be an effort to bypass what might otherwise be a contentious Senate confirmation process for Warren, had President Obama nominated Warren for a permanent position.  The announcement is also significant in perhaps also signaling the Administration’s intended focus on the economy and more specifically, on the American consumer.
 
This appointment follows the President’s July signing of the Wall Street Reform and Consumer Protection Act, which according to the White House’s own press release, “enacts the strongest consumer financial protections ever and creates an independent Consumer Financial Protection Bureau.”  The Obama administration views the Consumer Financial Protection Bureau as a vehicle for addressing abuses in the many business and economic industries, such as banking and lending, with President Obama explicitly stating, “the Consumer Financial Protection Bureau will crack down on the abusive practices of unscrupulous mortgage lenders, reinforce the new credit card law we passed banning unfair rate hikes, and ensure that folks aren’t unwittingly caught by overdraft fees when they sign up for a checking account.  The Consumer Financial Protection Bureau will be a watchdog for the American consumer, charged with enforcing the toughest financial protections in history...”
 
It appears Warren will take the lead in devising the Bureau and sustaining its efficacy.  According to the White House, under the Act, “the Treasury Department has the authority to get the consumer agency up and running, and Warren will serve as Special Advisor to the Secretary of Treasury to guide this effort. She will also serve as an Assistant to the President. “
 
Amongst other accomplishments, the White House’s press release on Professor Elizabeth Warren notes she has “most recently served as the Leo Gottlieb Professor of Law at Harvard University,” and that Warren “was the Chief Adviser to the National Bankruptcy Review Commission…was appointed by Chief Justice Rehnquist as the first academic member of the Federal Judicial Education Committee…served as a member of the Commission on Economic Inclusion established by the FDIC…has written nine books…more than a hundred scholarly articles dealing with credit and economic stress...  has been principal investigator on empirical studies funded by the National Science Foundation, the Ford Foundation, and more than a dozen other foundations…[and]…has testified several times before House and the Senate committees on financial issues...”
 
Current Treasury Secretary Geithner has also commended Warren, saying, “Professor Warren has been a pioneer on the issues before the Consumer Financial Protection Bureau, and she will now help lead the effort to stand up the agency. We are grateful for her willingness to serve and know she will be a tremendous asset to us all as we take on the task at hand.”

As of January, the U.S. Department of the Treasury also selected Holly Petraeus to establish the Office of Servicemember Affairs being built by the Consumer Financial Protection Bureau implementation team.  According to the Treasury, Petraeus is a former Army civilian employee, comes from a military family, and is also the wife of Army Gen. David Petraeus, current Commander of the International Security Assistance Force in Afghanistan and former Commander of the U.S. Central Command.  Warren welcomed Petraeus to her post, stating in part, "...[i]t soon became clear that Holly would be the perfect person to guide the establishment of the office...[s]he is the kind of leader we need...Holly understands—from both her personal experience as a military spouse and her work...that men and women in our armed forces encounter unique financial obstacles."
 
While the White House’s hopes about the Bureau, and Professor Warren’s role may be laudable, the more recent U.S. mid-term elections may change the make-up of the President’s current Administration, and priorities; presumably, this could also conceivably include Treasury staff and the scope of the Bureau at issue.  Although the Democrats managed to maintain the lead in the Senate after the elections, the Republicans succeeded in taking the House.  With the additional Republican wins in the Gubernatorial races as well, it’s clear that the Obama Administration will undergo a period of strategic transition.  Consequently, it’s too early to tell which direction any intended White House policy may take, including the instant endeavor.  Just as with the first two years of the Obama administration, the next two will remain under the microscope.
 
Kerry Ayazi resides in Los Angeles, CA.  www.kerryayazi.com