There has been a lot of speculation about whether Senator-elect Elizabeth Warren will get a seat on the Senate Banking Committee, a perfect forum to go after the financial industry. If Ms. Warren does get the coveted spot, she may have to reserve some of her ire for the Bureau of Consumer Financial Protection, the regulatory agency she helped create.
In her Congressional seat, Ms. Warren may find the Bureau's lack of accountability to Congress frustrating. The Bureau, as designed by Dodd-Frank, has wide latitude to set its budget and use it to further whatever goals the Bureau's sole director wishes to pursue. If the Bureau proceeds with its proposals to overrule statutory provisions it finds wanting, Congress may not even be able to constrain the Bureau by statute.
Even Ms. Warren's ability to ask questions at Senate hearings could be curbed by the Bureau's unwillingness to answer them. For example, Ms. Warren, representing the Bureau at a Congressional hearing in May 2011, told Subcommittee Chairman McHenry that he was "causing problems" by keeping her longer than the hour she had allotted for the hearing.
Perhaps as long as Mr. Cordray serves as director of the Bureau and Ms. Warren wields informal influence over the Bureau, she will be perfectly content to leave the agency officially unfettered by Congress. She may feel different when a new head of the Bureau--someone who takes an approach to consumer protection divergent from her own and does not take her phone calls--arrives on the scene and turns the Bureau in a direction she does not like. Anticipating such a scenario, Ms. Warren could, once she enters the Senate, join her many colleagues in calling for greater accountability for the Bureau.