After months of fierce opposition from Wall Street, corporate lobbyists and Republican lawmakers, the Consumer Financial Protection Bureau officially launches this week in Washington, D.C. A product of last year’s overhaul of financial regulation, the bureau was established to protect consumers from deceptive practices. Republicans have sought to weaken its reach with a number of restrictive measures, including granting other regulatory bodies veto power over the bureau’s decisions. This week, Republicans scored another victory with President Obama’s announcement of his choice to head the bureau. Obama has tapped former Ohio Attorney General Richard Cordray instead of Elizabeth Warren, the Harvard professor who first proposed the bureau and has overseen its establishment for the past year. "[Cordray] is no Elizabeth Warren. He doesn’t have her communication skills,” says Nader. “She is a rare find. And by throwing her overboard, Obama has signaled to hundreds of good, smart people all over the country, who would like to turn our government around and make it stand for the people, that they may be too good for the president, they may be too good for the rogue Republicans.” [includes rush transcript]
This is a rush transcript. Copy may not be in its final form.
AMY GOODMAN: After months of fierce opposition from Wall Street, corporate lobbyists, and mostly Republican lawmakers, the Consumer Financial Protection Bureau officially launches in Washington this week. A product of last year’s overhaul of financial regulation, the bureau was established to protect consumers from deceptive practices. Republicans have sought to weaken its reach with a number of restrictive measures, including granting other regulatory bodies veto power over the bureau’s decisions.
This week Republicans scored another victory with President Obama’s announcement of his choice to head the bureau. Obama has tapped former Ohio Attorney General Richard Cordray instead of Elizabeth Warren, the Harvard professor who first proposed the bureau and has overseen its establishment for the past year. Warren had been the choice of many progressive organizations, but her nomination was strongly opposed by Republican lawmakers and the banking industry.
Flanked by Warren, Cordray and Treasury Secretary Timothy Geithner, President Obama said he’s confident in his choice to head the bureau.
PRESIDENT BARACK OBAMA: I am proud to nominate Richard Cordray to this post. And we’ve 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. They’ve already spent tens of millions of dollars this year to try to weaken the laws that are designed to protect consumers. And they’ve got allies in Congress who are trying to undo the progress that we’ve made. We’re not going to let that happen. 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 don’t have teams of lawyers from blue-chip law firms. They can’t 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.
AMY GOODMAN: Speaking shortly afterwards on MSNBC, Elizabeth Warren said she also supports Obama’s decision to nominate Cordray.
ELIZABETH WARREN: Oh, let’s be clear here. I’ve had a chance to see this thing come to light. And Richard Cordray is one of the first people I recruited to be part of the team to stand it up. He’s tough. He’s smart. It’s exactly what we need. It’s a new chapter for the consumer agency, and I couldn’t be more proud.
AMY GOODMAN: Elizabeth Warren has left open the possibility of a Senate run in her home state of Massachusetts, where she would take on Republican Senator Scott Brown, but said she has to go home to Massachusetts first and think outside of the Beltway.
For more on President Obama’s decision to overlook Elizabeth Warren, we’re joined from Washington, D.C., by Ralph Nader, longtime consumer advocate, corporate critic and former presidential candidate.
Welcome to Democracy Now!, Ralph Nader. What are your thoughts on the passing over of Elizabeth Warren?
RALPH NADER: Well, our spineless president speaks again with a forked tongue. He talks about a tough agency, and he’s just thrown overboard the toughest federal cop on corporate crime, fraud and abuse against millions of Americans’ pensions and savings, and then tries to convince people that he’s really being tough against Wall Street. He’s basically a political coward. And the problem with that is not just detonating Elizabeth Warren’s career culmination of heading the agency that she conceived and built out of the Treasury Department in the last few months, but he’s signaling once again to the rogue Republicans in Congress that he has no backbone, that he’s going to cave. And that’s what he’s been doing. He threw Van Jones overboard, because Glenn Beck attacked—of all people—attacked Van Jones, his assistant in the White House. He doesn’t stand by his people, unless these people stand for Wall Street, like William Daley, Timothy Geithner, Larry Summers. You’d think he’d give at least one post—one post—to the consumer constituency, the liberals and progressives, that brought him to the White House. But that is not the way he calculates it.
You know, he’s in trouble politically in the minds of some people. Bill Curry, who was a special assistant to Clinton, very astute political observer in Connecticut, said recently that if Romney is the candidate, Romney will take over 46 states, including Connecticut. So, some people think that he’s making a strategic and tactical mistake by constantly turning his back on the people—minorities, poor people—never mentions the poor, you notice that? Geez, there are only 60 million people living in grinding poverty in this country. He mentions the shrinking middle class.
So this has a lot of ramifications, Amy, as to what he did. But one aspect of it should not be ignored, and that’s sexism. The Treasury Department is full of ex-Wall Street males. It’s an old boys’ club. And they don’t like an uppity woman who happens—in Theresa Amato’s words, an article on the Washington Post web yesterday, Theresa Amato’s words—having a woman who has both brains and backbone, and instead of getting the job, she gets the pink slip. And there are people on Capitol Hill who have told me recently there is not a little sexism involved here. And that’s another shame on Barack Obama.
AMY GOODMAN: Can you talk, Ralph Nader, about why you think Elizabeth Warren should have been appointed? What is her background? How did she come to be so involved with setting up this consumer bureau?
RALPH NADER: Well, she starts with a blue-collar family in Oklahoma, and she never forgets that. They worked with their hands. They worked hard. And she comes up and becomes a tenured professor at Harvard Law School, one of the nation’s leading experts on bankruptcy, and clearly the nation’s leading expert on consumer finance and all the abuses people who have credit cards and have to hook into payday loans and rent-to-own loan rackets and who’ve lost their homes because of fine print in mortgages, etc.—she is the nation’s expert on this. She comes to Washington at the request of Harry Reid to head a special congressional oversight entity, pursuant to the Wall Street collapse and bailout, does a sterling job, has a heavy cross-examination of Timothy Geithner in public. He didn’t like that, and he never forgot that. And she is—then finds herself in Treasury, wondering whether she’s going to be the new head of this agency, which passed as part of the Dodd-Frank bill.
And it turns out that she was allowed to build it. She recruited very competent people in the agency. I think it sets the standard for American consumer protection, in terms of competent staff. And then she wants the job. Everybody knows she wants the job. But listen to how this coward in the White House handled it yesterday. He said, "Elizabeth Warren, you’ve done a great job building this agency, and one of your charges was to find a director. And you have found a great director, Richard Cordray." Imagine. He puts the words in her mouth, when he knows very well that she wanted this job as the culmination of her career. And it’s too bad that the leading women’s organization, such as NOW and [Feminist] Majority and others, did not take a strong stand, because this was a legitimate women’s issue, not just a consumer issue. There was sexism involved here. They’re too involved in other things, and they didn’t take a strong stand for her on behalf of all the working women in America, many of them poor, many of them chief candidates for continued Wall Street ripoffs and crimes.
AMY GOODMAN: What about, Ralph Nader, Cordray? What about his background and where you think he’ll take the agency?
RALPH NADER: Well, I think it remains to be seen. When he was in the Ohio attorney general’s office in 2004, before he became attorney general, he was in charge of signing off on ways to get me off the ballot when I was running for president. And they did get me off the ballot in a very disreputable manner. But as attorney general, he was pretty good. So, let’s put it this way: he’s a work in progress. But he’s no Elizabeth Warren. He doesn’t have her communication skills. She’s a superb communicator. And I hope we’ll hear from her in the future, whether politically or in some other position. She is a rare find.
And by throwing her overboard, Obama has signaled to hundreds of good, smart people all over the country, who would like to turn our government around and make it stand for the people, that they may be too good for the president, they may be too good for the rogue Republicans. And so, in that sense, it has a ripple effect, that’s a very negative message to a possible resurgence of the quality of political appointees in Washington, as well as the civil service, that’s begging for quality political appointee leadership.
AMY GOODMAN: Ralph, can you talk more about the economy right now? Talk about who’s protected, who isn’t, and that really goes right into this deficit debate that is going on in Washington right now, the debt lock. What is discussed? What isn’t? Who’s protected in this? What budgets are not questioned, and what’s being slashed, and where President Obama stands in all of this?
RALPH NADER: Well, let’s segue from Elizabeth Warren, because the real issue in Elizabeth Warren is contract peonage. The American people, every day, engage in transactions, with these contract—fine-print contracts wrapped around their necks, strangling them. They have really destroyed the concept of freedom of contract in this country. Listen up, so called Tea Partiers, and get on board here. And this is what led to the mortgage debacle. There’s no time to explain it now, but the point is that corporations have taken over these contracts. They unilaterally change them. They block people from going to the court. They’re constantly penalizing—termination fees, this penalty, that penalty. It’s a total contract peonage. Contract serfs, that’s what they’ve turned the American people into. And they don’t even compete over these contracts. For example, if you don’t like Allstate, State Farm is the same, or if you don’t like Ford, GM contracts are the same. So people are trapped. And that is what is increasing the greed and the risk, in terms of deploying the insecurity that brought down the economy.
Now we have the situation with the deficit and the debt and spending and jobs. And it’s not that difficult to get out of it. The first thing you do is you get rid of corporate welfare. That’s hundreds of billions of dollars a year. The second is you tax corporations so that they don’t get away with no taxation. The Citizens for Tax Justice put out a report recently. They had 12 major corporations, like Honeywell, Verizon, General Electric, and in three years, Amy, they made $167 billion—with a "B" —dollars in profit, paid zero tax, and got two-and-a-half billion dollars back from the Treasury. So you can see, if you return the tax rates and the effective tax payments back to the prosperous 1960 level, there would be hundreds of billions of dollars. You get out of Afghanistan, Pakistan, stop being engaged in these criminal wars of aggression, and get out of Iraq, you’ll save another $150 billion. So, there are a lot of ways. Cutting the huge amount of redundancy and waste and out-of-date weapons programs in the Pentagon, again, another one. Bringing back the soldiers from Europe and East Asia, 65 years after World War II. What are they doing? Defending prosperous countries, like England and Germany and Italy and Japan, against what? Inner Mongolia or Moldova?
So, we know what the answers are. But we don’t have the power in Washington, because the liberal, progressive base appears to have no breaking point with the Democrats here in Washington. And that’s true for—that’s also true for the liberal intelligentsia. They have no—when you ask them, "Do you have any breaking point? How bad do these Democrats have to be, even though the Republicans are worse, for you to begin conditioning your vote, demanding more vigorous debates in the presidential primary, demanding more candidates, demanding rights for third parties, as the Center for Competitive Democracy has been pushing for? They have no breaking point. And if you have no breaking point, you have no moral compass, and people like Barack Obama know that you can be had. And indeed, they’ve been had.
AMY GOODMAN: Ralph Nader, the debt ceiling—how significant this is, and what happens if it is not lifted?
RALPH NADER: It will be lifted, because Wall Street has written a letter, with many corporate executives signing on and the Business Roundtable, and they’re basically telling the Republicans, "On this one, you’ve got to grow up." These Republican delinquents are rattling a catastrophic cage of international confidence in the dollar and U.S. credit. And, of course, Moody’s and Standard & Poor are rattling, it might downgrade the U.S. debt. Imagine, these crooked rating companies, who helped fake the valuations on Wall Street and bring down the economy, are now evaluating the U.S. government’s credit. But be that as it may, it’s almost 100 percent certain that very soon, whether in two, three, four days, they will agree, both Republican and Democrats, to raise the debt limit, probably without any conditions. I think the McConnell plan, however unconstitutional it is, shifting the decision entirely to the executive branch, when last I heard that that was a constitutional authority of the Congress, I think that’s probably going to be the fallback position.
AMY GOODMAN: Finally, Elizabeth Warren, though she was bypassed by President Obama, what would you think of a Senator Warren from Massachusetts? And do you think it’s possible against Scott Brown?
RALPH NADER: Well, I’d like to see Senator Warren in 2012. I’d like to see her run for president in 2016. She’s a rare find. She has all the qualities, including a great deal of self-control, in addition to her knowledge. But the question is, is she too honest for Massachusetts Democratic politics? In other words, can she put enough marbles in her mouth to have to support interest groups and foreign policy positions that she doesn’t believe in? Maybe she could circumvent it, focus on the area of her expertise, which is the economic travail of poor people and middle-class people, in multiple dimensions. If she does that and goes right across from Springfield to Boston and Williams to Plymouth, she could take Senator Brown, I think quite readily.
AMY GOODMAN: We’re going to it there, Ralph Nader, longtime consumer advocate, corporate critic, former presidential candidate, speaking to us from Washington, D.C.