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Surprise Surprise!

Posted in CFPB People

Today, the full Senate voted (53-45) to block President Obama’s nomination of Richard Cordray as the first Director of the CFPB. Scott Brown, who is facing a challenge for his Senate seat from Elizabeth Warren, was the only Republican to vote in favor of the nomination.

The Senate’s rejection happened despite a strong push by the White House and Treasury Department. However, the outcome of the vote was never really in doubt, given that Senate Republicans have long made clear that they will not approve any nominee as Director unless the CFPB is first restructured. As a result, the prospect of a confirmed CFPB Director before the next presidential term that begins in 2013 looks dim.

The current stalemate also raises questions about the future of the Cordray nomination itself. Since it appears President Obama is hoping to score political points by using the nomination as an example of Republican intransigence, it seems unlikely he will pull the nomination. Indeed, in a televised statement made after the vote, the President told reporters that he was not giving up on the nomination and would not close the door on a recess appointment. It is possible Mr. Cordray (like Elizabeth Warren) could choose to leave the CFPB. But there is also the unsettling possibility that Mr. Cordray might dig in his heels and ramp up enforcement activity.