Incompetence a Major Plus in the Hunt for a Consumer Protection Bureau Head

It's really one of the themes of the Great Recession.

Someone identifies a problem and all the many ways it could have been prevented or at least limited with more rigorous regulation. Then, someone points out the policies Congress is considering to address said economic problem while chastened industry A or B works to water them down.

But even in this climate, the partisan wrangling about who is the best person to lead the nation's new financial consumer watchdog agency is pretty shocking.

It turns out, being a consumer advocate with a track record of spotting and lambasting the financial products and industry practices eroding poor and middle-class American households may be exactly what makes some candidates all wrong for the job.

Elizabeth Warren — a Harvard law professor and bankruptcy expert who as early as 2006 was talking publicly about the exorbitant fees, arbitrary interest rate hikes and other practices that credit card and mortgage lending companies were imposing on the poorly-informed and thinly-resourced working masses — helped establish the very ideas behind the nation's new Bureau of Consumer Financial Protection. And, the Oklahoma native has used her wise Western wit to describe the banking industry's tactics and oversee TARP (the Troubled Asset Relief Program).

But only hours after President Obama signed the bill creating the bureau, conservative members of Congress were questioning her ability to clear the confirmation process (her rejection would be thanks, in large part, to bank lobbyists).

Say what you will about Americans' seemingly insatiable appetite for consumer goods and the debt to finance them, but Warren was out front talking early and often about the combustible when combined effect of stagnant wages, nearly unbridled credit practices and the American cultural expectation that our standard of living should top that of our parents.

Hindsight has made clear to us all that an era heralded for record home ownership gains among single women, ethnic and racial minorities also turned out to be a period that marked its end with unprecedented foreclosures and revelations that sub-prime and ethically-unencumbered lenders targeted some of these same groups.

So, if the plight of Elizabeth Warren and the 3.1 million homeowners projected to receive some type of foreclosure notice this year aren't enough to make you start speaking in recession-themed clichés, consider this: the New York Times reported on Wednesday that lobbying and legal firm headhunters are also aggressively working to hire people who used to work for federal regulatory agencies.

It turns out that the very people who failed to rigorously implement existing regulations, protect consumers and prevent the economic meltdown are the people the banking industry wants.

Photo credit: Jeff Thomas