In addition to being charged with forming the newly-created agency dedicated to protecting consumers from abusive financial products, Elizabeth Warren will lead the administration's effort to find the first director of the nascent unit, the Huffington Post has learned.
President Barack Obama will name Warren, a famed consumer advocate and passionate defender of the middle class, as one of his top advisers on Friday, creating a role inside the White House for the Harvard Law professor and bailout watchdog to lead the effort in forming the Bureau of Consumer Financial Protection.
Warren, though, will not be named as his nominee for the Senate-confirmed, five-year post to lead the new entity -- at least not yet. She will, however, lead the search to find the right person. Consumer advocates and several dozen members of Congress say she's it.
"Who knows? Maybe she'll pull a Dick Cheney," said one source familiar with the matter.
Former Vice President Cheney was tapped by then-Gov. George W. Bush to lead his search for a running mate during the 2000 presidential campaign. Cheney settled on himself.
The possibility of Obama picking Warren surged in recent days after Obama heaped praise on her last Friday and called her a "dear friend." However, a day after word leaked Wednesday that Warren would be selected for this different role, news outlets including CBS News, citing the White House, reported that not only was it unlikely Warren would get the nod -- she allegedly didn't want the position in the first place. House Financial Services Chairman Barney Frank (D-Mass.) also said that Warren didn't want the five-year role.
Warren backers hold out hope that she remains on the short list of nominees for the permanent job, but CBS News reports that, "It is highly unlikely that Warren ... will eventually be nominated to be director of the bureau." According to CBS, Warren "is no longer on the list" for the long-term position.
The reports could serve to undermine Warren before she even steps into the job. However, if it appears that she'll ultimately deem herself the most qualified candidate for the permanent position -- and her backers in Congress, the White House, and advocacy organizations that have the White House's ear agree -- Obama could very well end up choosing the middle class advocate. Support for Warren reached a fever pitch over the summer, as backers presented her as critical to both the success of the new agency and the financial reform effort as a whole.
With a budget approaching $500 million and a staff expected to number in the hundreds, the agency represents the consolidation of a multitude of units inside government charged with protecting borrowers. It's been touted as the capstone of the Obama administration's effort to reform the nation's broken financial system.
Getting the right person in the job for the historic agency is key, experts and administration officials say. And Warren has long been touted as the natural choice for the position, given her advocacy on behalf of borrowers, her noted research into consumer debt and financial products, and the fact that she conceived the agency in a 2007 journal article.
But Warren is seen as a polarizing figure. Her aggressive advocacy on behalf of working-class families has made her an enemy of lenders who favor less regulation and more opportunities for fee-based income, like excessive overdraft levies and credit card surcharges. Mortgages with exploding interest rates and well-hidden fees were particularly profitable for lenders during the boom, and Warren has fought against such practices.
In her new role, Warren will be charged with getting the nascent agency on its feet and setting the tone for years to come. The White House isn't expected to name a nominee for the directorship for months, sources say.
Shahien Nasiripour is the business reporter for the Huffington Post. You can send him an e-mail; bookmark his page; subscribe to his RSS feed; follow him on Twitter; friend him on Facebook; become a fan; and/or get e-mail alerts when he reports the latest news. He can be reached at 646-274-2455.