The potential appointment of Harvard Law School Professor Elizabeth Warren to head a new consumer agency in Washington has gained a broad base of support due to her academic credentials and her personal attachment to the project.
President Barack Obama signed last Wednesday the financial legislation that officially established the creation of the Consumer Financial Protection Agency, but he has not yet announced whether Warren will be named to run it.
As described in the recent legislation, the new agency will be responsible for regulating the provision of consumer financial products, conducting research on financial counseling and education, and handling consumer complaints. The director of the bureau would serve for five-year terms.
In a recent interview with ABC, Obama said that he was a student at Harvard while Warren, an expert of bankruptcy and commercial law, taught at the Law School and that he held the “highest regard” for her.
“Elizabeth Warren is a terrific candidate,” White House spokesman Robert Gibbs said at a news briefing, The New York Times reported. “I don’t think any criticism in any way by anybody would disqualify her and I think she’s very confirmable for this job.”
Warren, who joined the Harvard Law School faculty in 1992, was named the 2009 Bostonian of the Year by The Boston Globe for bringing “a sense of sanity to the economic crisis.”
The Oklahoma native and former registered Republican was appointed chair of the Congressional Oversight Panel in 2008. In that government post, she defended the middle class and kept close watch on the government’s Troubled Asset Relief Program, which was created in October 2008 to stave off a potential collapse of the U.S. financial system.
Now, Warren finds herself contending for a position at the helm of the new bureau—which she has been advocating for since 2007, when she published an article calling for an agency that protects the consumers of financial products in the same way that the Consumer Product Safety Commission protects buyers of goods.
“It needs a leader who has a passion for protecting consumer interests—and who recognizes that doing so contributes to the health of the financial system,” The Globe wrote about the directorship of the new bureau. “Warren is easily the best candidate for the position.”
The other candidates include Eric Stein, a consumer protection official in the Treasury Department; Martha Coakley, the attorney general of Massachusetts; and Wharton School professor Susan M. Wachter.
Warren has received the endorsements of major papers like The Times and The Globe—as well as many of her colleagues over at the Law School, who expressed full confidence in Warren’s ability to run the new bureau.
“She is brilliant, hardworking, a consummate professional, and an outstanding teacher,” said I. Glenn Cohen, an assistant professor of law who also serves as co-director of the Petrie-Flom Center for Health Law Policy, Biotechnology, and Bioethics.
Other colleagues also spoke in strong admiration of Warren’s “energetic” teaching style. During a typical class, she would call upon 20 or so students, challenging them as she moved quickly from one student to the next.
“You see that all the students are sitting at the edge of their seats,” said Jeannie Suk, assistant professor of law. “It’s a combination of excitement and fear...that she’s going to call on you.”
Assistant Law Professor D. James Greiner said that her style of constant questioning would be an apt trait for the government position.
“I think that’s what you want—somebody who’s constantly looking for facts,” Greiner said. “She’s an empirical investigator, trying to base decisions [on facts]. That’s what you want in a government official—that fact-driven, investigative mind.”
A New York Times editorial stated that bank lobbyists are saying that Warren would “overreact” in protecting consumers from abusive loans, but that her academic work shows that Warren understands the “power of credit to do good.”
“The banks don’t oppose Ms. Warren because she doesn’t get it,” the editorial stated. “They oppose her because she does.”
But the new agency has received a slew of criticism for its organization under the Federal Reserve. Those opposed to the legislation are dubious of its efficacy, arguing that the Federal Reserve does not protect consumers in the first place.
Moreover, Treasury Secretary Timothy Geithner said that he does not endorse Warren to run the agency due to her criticism of the Obama administration’s handling of Troubled Asset Relief Program.
—Staff writer Xi Yu can be reached at firstname.lastname@example.org.