Obama appoints Richard Cordray to lead consumer agency
President Barack Obama is vowing to fight any efforts to block the work of a new consumer protection bureau as he introduces a former Ohio attorney general to run the agency.
If confirmed by the Senate, Richard Cordray would head the agency tasked with being a government watchdog over mortgages, credit cards and other forms of lending. Obama says the agency will protect the public from financial fraud and abuse.
"Weâve been recently reminded why this job is going to be so important. There is an army of lobbyists and lawyers right now working to water down the protections and the reforms that we passed. Theyâve already spent tens of millions of dollars this year to try to weaken the laws that are designed to protect consumers. And theyâve got allies in Congress who are trying to undo the progress that weâve made. Weâre not going to let that happen.
"The fact is the financial crisis and the recession were not the result of normal economic cycles or just a run of bad luck. They were abuses and there was a lack of smart regulations. So weâre not just going to shrug our shoulders and hope it doesnât happen again. Weâre not going to go back to the status quo where consumers couldnât count on getting protections that they deserved. Weâre not going to go back to a time when our whole economy was vulnerable to a massive financial crisis. Thatâs why reform matters. Thatâs why this bureau matters. I will fight any efforts to repeal or undermine the important changes that we passed. And we are going to stand up this bureau and make sure it is doing the right thing for middle-class families all across the country.
"Middle-class families and seniors donât have teams of lawyers from blue-chip law firms."
Obama and Cordray were joined in the Rose Garden by Elizabeth Warren, a special assistant to the president who had been charged with getting the agency started. Consumer groups wanted her to head it, but she was strongly opposed by Republicans and would have faced a difficult confirmation fight.
Republicans have already threatened to block Cordray's Senate confirmation as well.
Here's the full text of Obama's speech as provided by the White House:
THE WHITE HOUSE
Office of the Press Secretary
For Immediate Release July 18, 2011
REMARKS BY THE PRESIDENT
IN NOMINATING RICHARD CORDRAY
AS DIRECTOR OF THE CONSUMER FINANCIAL PROTECTION BUREAU
1:15 P.M. EDT
THE PRESIDENT: Good afternoon, everybody. It has been almost three years since the financial crisis pulled the economy into a deep recession. And millions of families are still hurting because of it. Theyâre trying to get by on one income instead of two, on fewer shifts at the plant or at the hospital. Theyâre cutting expenses, giving up on a family night out so thereâs money for groceries. And for a lot of families, things were tough even before the recession.
So weâve got to get the economy growing faster and make sure that small businesses can hire again, so that an entrepreneur out there can sell a new product, so that the middle class is getting stronger again, and so folks feel confident in their futures and their childrenâs futures.
Thatâs why we canât let politics stand in the way of doing the right thing in Washington. We can't stand in the way when it comes to doing the right thing on deficits. And thatâs why I want to take steps like making sure payroll taxes for middle-class families donât go back up next year. Thatâs why itâs so important that we tackle the problems that led us into this recession in the first place.
One of the biggest problems was that the tables were tilted against ordinary people in the financial system. When you get a home loan, it came with pages of fine print. When you got a credit card, it was as if the contract was written in another language. These kinds of things opened the door to unscrupulous practices -- loans with hidden fees and terms that meant your rate could double overnight. It led to people getting mortgages they couldnât afford, and it put honest businesses at a disadvantage. And it encouraged dangerously risky behavior on Wall Street, which dragged the economy into the mess that weâre still trying to clean up.
Thatâs why we passed financial reform a year ago. It was a common-sense law that did three things. First, it made taxpayer-funded bailouts illegal, so taxpayers donât have to foot the bill if a big bank goes under. Second, it said to Wall Street firms, you canât take the same kind of reckless risks that led to the crisis. And third, it put in place the stronger -- the strongest consumer protections in history.
Now, to make sure that these protections worked -â so ordinary people were dealt with fairly, so they could make informed decisions about their finances â- we didnât just change the law. We changed the way the government did business. For years, the job of protecting consumers was divided up in a lot of different agencies. So if you had a problem with a mortgage lender, you called one place. If you had a problem with a credit card company, you called somebody else. It meant there were a lot of people who were responsible, but that meant nobody was responsible.
And we changed that. We cut the bureaucracy and put one consumer watchdog in charge, with just one job: looking out for regular people in the financial system. Now, this is an idea that I got from Elizabeth Warren, who I first met years ago. Back then -- this is long before the financial crisis -- Elizabeth was sounding the alarm on predatory lending and the financial pressures on middle-class families. And in the years since, sheâs become perhaps the leading voice in our country on behalf of consumers. And letâs face it, sheâs done it while facing some very tough opposition and drawing a fair amount of heat. Fortunately, sheâs very tough.
And thatâs why I asked Elizabeth Warren to set up this new bureau. Over the past year she has done an extraordinary job. Already, the agency is starting to do a whole bunch of things that are going to be important for consumers -- making sure loan contracts and credit card terms are simpler and written in plain English. Already, thanks to the leadership of the bureau, weâre seeing men and women in uniform who are getting more protections against fraud and deception when it comes to financial practices. And as part of her charge, I asked Elizabeth to find the best possible choice for director of the bureau.
And thatâs who we found in Richard Cordray. Richard was one of the first people that Elizabeth recruited, and heâs helped stand up the bureauâs enforcement division over the past six months. I should also point out that he took this job â- which meant being away from his wife and 12-year-old twins back in Ohio â- because he believed so deeply in the mission of the bureau. Prior to this, as Ohioâs attorney general, Rich helped recover billions of dollars in things like pension funds on behalf of retirees, and stepped up the stateâs efforts against unscrupulous lending practices. Heâs also served as Ohioâs treasurer and has successfully worked with people across the ideological spectrum -â Democrats and Republicans, banks and consumer advocates.
Now, last but not least, back in the â80s, Richard was also a five-time Jeopardy champion -- (laughter) -- and a semi-finalist in the Tournament of Champions. Not too shabby. Thatâs why all his confirmation -- all his answers at his confirmation hearings will be in the form of a question. Thatâs a joke. (Laughter.)
So I am proud to nominate Richard Cordray to this post. And weâve been recently reminded why this job is going to be so important. There is an army of lobbyists and lawyers right now working to water down the protections and the reforms that we passed. Theyâve already spent tens of millions of dollars this year to try to weaken the laws that are designed to protect consumers. And theyâve got allies in Congress who are trying to undo the progress that weâve made. Weâre not going to let that happen.
The fact is the financial crisis and the recession were not the result of normal economic cycles or just a run of bad luck. They were abuses and there was a lack of smart regulations. So weâre not just going to shrug our shoulders and hope it doesnât happen again. Weâre not going to go back to the status quo where consumers couldnât count on getting protections that they deserved. Weâre not going to go back to a time when our whole economy was vulnerable to a massive financial crisis. Thatâs why reform matters. Thatâs why this bureau matters. I will fight any efforts to repeal or undermine the important changes that we passed. And we are going to stand up this bureau and make sure it is doing the right thing for middle-class families all across the country.
Middle-class families and seniors donât have teams of lawyers from blue-chip law firms. They canât afford to hire a lobbyist to look out for their interests. But they deserve to be treated honestly. They deserve a basic measure of protection against abuse. They shouldnât have to be a corporate lawyer in order to be able to read something theyâre signing to take out a mortgage or to get a credit card. They ought to be free to make informed decisions, to buy a home or open a credit card or take out a student loan, and they should have confidence that theyâre not being swindled. And thatâs what this consumer bureau will achieve.
I look forward to working with Richard Cordray as this bureau stands up on behalf of consumers all across the country. I want to thank both Elizabeth and Tim Geithner for the extraordinary work that theyâve done over at Treasury to make sure that, a year after we passed this law, it is already having an impact and itâs going to have impact for years to come.
Thank you very much and congratulations, Rich.
Q Mr. President, any progress in your talks with Speaker Boehner yesterday? Any progress? THE PRESIDENT: Weâre making progress. END 1:21 P.M. EDT
The White House Â· 1600 Pennsylvania Avenue, NW Â· Washington DC 20500 Â· 202-456-1111comments powered by Disqus