Is Barney Frank After Elizabeth Warren's Job Even Before She Has It? [Updated]

Last Updated Aug 24, 2010 8:42 PM EDT

Rep. Barney Frank supports Elizabeth Warren to lead the new Consumer Financial Protection Bureau. Yet he also may have another candidate in mind -- himself. [UPDATE: Frank called back to deny it and to reiterate his support for Warren, more or less exactly the way you'd expect him to. See below.]
Citing a source on the House Financial Services Committee "close to" Frank, who chairs the panel, bank analyst Christopher Whalen of Institutional Risk Analytics says the Massachusetts Democrat is throwing his cudgel into the ring:
It may surprise some observers that House Financial Services Committee Chairman Barney Frank may want the CFPB job for himself. Frank reportedly has already expressed interest to the White House. Sad to say, Chairman Frank probably has seniority over Chairman Warren.

"Barney did some heavy lifting," says a source on the committee who is close to Frank. "He might want a different gig, especially if he loses the chairman's seat in November. Frank would not want to hang around in Congress as part of the minority. Being the first CFPB emperor, however, could be a more interesting gig than, say, eventually being made head of HUD o[r] the FHA."
That raises an interesting question: Who wins in a cage match between the famously pugnacious Warren and the even more famously pugnacious Frank? The congressman has been battering political adversaries for years, of course, but Warren has a pretty mean ground game herself, judging from the stranglehold she put on Tim Geithner last year over the AIG bailout. Kidding! She and Frank aren't even in the same weight class.


Frank's office didn't immediately return a call seeking comment.

Whalen suggests the CFPB job is Frank's for the taking. Could be. The lawmaker is almost certainly more to the banking industry's taste than Warren (which admittedly isn't saying much, since Torquemada would be, too). Frank, a fixture on Capitol Hill, knows how to cut deals with big business, as he showed in helping lead the fight over financial reform. It's no accident that his leading financial contributor over his career is the American Bankers Association, followed by JPMorgan Chase (JPM).

That doesn't mean Frank's a pushover for Wall Street -- he's not. But by Washington standards, at least, he's housebroken. Warren, by contrast, speaks with the kind of plain-spoken, Calvinist fervor in defense of consumers that gives many bankers the willies. She's also likable, boosting her populist appeal, while Frank is more of an acquired (and perhaps regional) taste.

Frank is popular among liberals, so tapping him to head the CFPB also might be a way for President Obama to throw a bone to progressives, who will be up in arms if Warren doesn't get the job. Other candidates for the position, such as Assistant Treasury Secretary Michael Barr, don't have the same street-cred on the Left as Frank. That could mean something if the GOP takes back the House, as some pundits predict.

Talk is Obama might not name his choice to head the bureau until after the midterm elections this fall. If true, that's a bad sign for Warren. Politically, the whole point of risking what would undoubtedly be a fractious confirmation fight before November would be for the White House to curry favor with voters, while milking anti-Wall Street sentiment. If that's not in the works, then the Administration could decide she's no longer worth fighting for.

Update: Rep. Frank called me back and categorically denied having interest in heading the CFPB. "It's irresponsibly delusional," he said, adding that he would never give up chairing the House Financial Services Committee in exchange for the consumer protection post and reiterating his support for Warren.

OK, I'm convinced -- it's wacky.

Image from Wikimedia Commons
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  • Alain Sherter On Twitter»

    Alain Sherter is an award-winning business journalist who has written for The Deal, MarketWatch and Thomson Financial Media.

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