D.C. Circuit Crimps President's Recess Appointment Power

Two weeks ago, on January 25th, 2013, a panel of the United States Circuit Court of Appeals for the D.C. Circuit, consisting of three judges appointed by Republican presidents, unanimously invalidated a decision by the National Labor Relations Board. In Noel Canning v. N.L.R.B., the D.C. Circuit held that the Board did not have a sufficient number of members, or quorum, to make binding decisions because three of the five Board members were appointed through an improper use of the Constitution's Recess Appointments Clause. This decision calls into question many of the NLRB's actions since the three recess appointments were made last year.

Although the decision by the D.C. Circuit was specific to the NLRB, the rationale for the decision, if applied to other recess appointments, could result in chaos throughout the federal government. Several commentators have noted that decisions issued by the Consumer Financial Protection Bureau over the last year could also be subject to invalidation, since Director Richard Cordray was recess appointed at the same time as the NLRB appointees.

Norman Ornstein of the American Enterprise Institute lambasted the D.C. Circuit's ruling as "a remarkable exercise of judicial overreach and arrogance." Ornstein highlighted the difference between President Obama's use of recess appointments from that of his predecessors:

I am not a fan of excessive use of recess appointments, especially when they are made to avoid a major controversy or the simple inconvenience of a possible negative vote in the Senate. But those kinds of recess appointments were made more frequently in the Reagan, Clinton and George W. Bush years . . . . Our current president has issued few recess appointments and did so only when faced with unprecedented filibusters against qualified and widely admired nominees who were opposed because Republicans wanted to emasculate their agencies in violation of common practice and the fiduciary duty of lawmakers to allow laws to be administered and implemented.

A report by the Congressional Research Service released earlier this week found that since January 1981, hundreds of recess appointments by Presidents Ronald Reagan (232), George H. W. Bush (78), Bill Clinton (139), George W. Bush (171), and Barack Obama (32) could have been deemed improper under Noel Canning's reasoning. In total, the report found that least 652 recess appointments were either made outside the narrow window the Court defined for making recess appointments or were made in a recess in which the vacancy did not occur—neither of which would be allowed under the judges' ruling.

In 2004, President George W. Bush made recess appointments of two controversial judges to federal circuit courts: Charles Pickering to the Fifth Circuit and William Pryor to the Eleventh Circuit. Since these recess appointments occurred long after the Senate session in which the vacancy occurred, at least two dozen judicial opinions authored by these judges could be vulnerable to invalidation were Noel Canning applied.

The NLRB can still request a rehearing en banc from the D.C. Circuit or, more likely, appeal to the Supreme Court. If that's the case, the Court is likely to consider the question, not only because of the implication for the separation of powers, but because the Eleventh Circuit interpreted the Recess Appointments Clause differently in a 2005 case. In addition, challenges to President Obama's recess NLRB appointments are still pending in other circuits. The NLRB's Chairman, Mark Gaston Pearce, has remarked that the Board will continue its work while the litigation continues. But until we have a final decision on the matter, a pall has been cast upon all recess appointments and the decisions made by such appointees.

PFAW

Recess Appointments Ruling Shows Consequences of GOP Obstructionism

Earlier today, the DC Circuit issued a decision in case challenging President Obama's recess appointments of three of the five members of the National Labor Relations Board. This is one of several lawsuits challenging these recess appointments, as well as that of Richard Cordray to lead the Consumer Financial Protection Board. While much of the focus will be on the fact that the court ruled against President Obama, this is just one part of a much larger picture: None of this litigation would be occurring but for nonstop and unprecedented obstructionism.

The president had made nominations to the NLRB in early 2011. But Senate Republicans prevented the Senate from holding yes-or-no confirmation votes, which meant that beginning last January, the NLRB would no longer have enough members to have a quorum. In other words, Republicans – who did not have the votes to change our federal labor laws legislatively – nevertheless could undermine an important agency dedicated to protecting the rights of labor. All they had to do was prevent the Senate from doing its job.

In the case of Richard Cordray, Republicans sought to accomplish through obstruction what they had failed to do legislatively. They opposed the creation of a strong Consumer Financial Protection Board during the first years of Obama's presidency, but they lost that battle. The Board was created, but it could not perform many of its vital consumer protection responsibilities without a director. Senate Republicans admitted that they had no problem at all with Richard Cordray. They simply refused to confirm him because they opposed the very existence of the Board he was asked by the president to run. As long as they could keep him off the Board, consumers would remain unprotected by many aspects of the new reform law.

The Senate should have been able to vote on all these confirmations, both to the NLRB and to the CFPB. But Senate Republicans chose to prevent those votes as part of their overall strategy of obstructing anything or anyone supported by President Obama. That harmful sabotage of one of the Senate's basic responsibilities is what led to the recess appointments.

It is worth noting that yesterday, the president announced that he will renominate Cordray. Republicans should not repeat the mistakes of the past: Whether they support him or not, they should allow the CFPB to do its job. And that can only happen if they allow a confirmation vote to occur.

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Obama Moves to Protect Workers and Consumers in Face of GOP Obstruction

Faced with uncompromising obstruction from Senate Republicans, President Obama made four recess appointments today to staff agencies that protect American workers and consumers.

First, the president appointed former Ohio attorney general Richard Cordray to head the Consumer Financial Protection Bureau, a watchdog post that has been vacant since the agency began operations last summer. Obama nominated Cordray in July, but met with unyielding opposition from Senate Republicans, who refused to even allow a confirmation vote on any person to the post unless the agency was first severely weakened. Announcing the recess appointment in Ohio, Obama said:

Now, every day that Richard waited to be confirmed -- and we were pretty patient. I mean, we kept on saying to Mitch McConnell and the other folks, let's go ahead and confirm him. Why isn't he being called up? Let's go. Every day that we waited was another day when millions of Americans were left unprotected. Because without a director in place, the consumer watchdog agency that we've set up doesn't have all the tools it needs to protect consumers against dishonest mortgage brokers or payday lenders and debt collectors who are taking advantage of consumers. And that's inexcusable. It's wrong. And I refuse to take no for an answer.

With Cordray installed at his new post, the CFPB – the brainchild of Massachusetts Senate candidate Elizabeth Warren – will finally be able to fully take on its job to protect consumers from harmful financial practices.

Later in the day, President Obama announced that he will also be making recess appointments to fill three seats on the National Labor Relations Board, another target of relentless Republican obstruction. If Republicans continued to block the president’s nominees to the board, it would lose its quorum – and its power to issue new rulings – midway through this month. The GOP’s grudge against the board resulted in its operating without a quorum from the end of 2007 through the beginning of 2010. The more than 500 decisions it made during that time were later thrown out by the Supreme Court.

The president had no choice but to make recess appointments to ensure that these important agencies can do their jobs, whether the Senate GOP wants them to or not.
 

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Ornstein: Senate GOP Causing "Damage to the Vital Interests of the United States"

The latest condemnation of the Senate GOP's dangerous obstruction against executive and judicial nominees comes from Norman Ornstein, a resident scholar at the conservative American Enterprise Institute. In a column published in Roll Call, Ornstein blasted Senate Republicans for the damage they are doing to our country.

Last week, Republicans blocked a vote on the nomination of Caitlin Halligan to serve on the D.C. Circuit Court of Appeals, setting a new standard for nominees to that court that will be virtually impossible for any president of either party to meet. Just two days later, they blocked a confirmation vote for Richard Cordray to head the Consumer Financial Protection Bureau, admitting that they did so not because of any problems with him but because they do not like the law creating that Bureau. Next, two days ago, Senate Democrats tried to overcome Republicans' obstruction of ambassadorial nominees, with mixed results. Ornstein writes:

The good news on Monday was that the Senate, in a show of broad bipartisan support, confirmed Norm Eisen to be the U.S. ambassador to the Czech Republic.

Eisen had been in the post for the past year on a recess appointment, and by all accounts, Czech and American, had been doing an exemplary job protecting and advancing American interests and values in a country that is a critical ally to the United States and an important commercial and trading partner. Why the recess appointment? Because Sen. Chuck Grassley (R-Iowa) decided well over a year ago that Eisen, while serving in the White House, had not been truthful to the Senator's staff over his role in the dismissal of the inspector general of AmeriCorps. Never mind that a voluminous record showed that Eisen had not dissembled, that the entire board of AmeriCorps, left to right, Democrats and Republicans, supported the dismissal, and the actions were upheld in two federal courts. Grassley would not budge.

Senate Democrats filed a successful cloture petition and Eisen was confirmed by voice vote. But the obstruction continued with a politically motivated filibuster of Mari Carmen Aponte to be ambassador to El Salvador. Aponte is now serving under a recess appointment, which expires at the end of the month.

The ostensible reason to oppose her? Decades ago Aponte had a boyfriend who might have had ties to Fidel Castro's government. Never mind that Senators had access to her FBI file — and that she has had a succession of top-secret clearances after exhaustive security checks. Aponte did not fare well — she fell 11 votes shy of the 60 needed once again to overcome cloture.

In a different world — i.e., the world the United States knew from 1789 until a few years ago — her 49-37 margin would have meant a comfortable confirmation. No more. Filibusters used to be rare events for bills, rarer for executive confirmations, rarer still for judicial nominations. Now they are more than routine; they are becoming the norm. Holds were not as rare, but the use of holds to block multiple nominees for not weeks or months but years or until death, were not typical; now they are the standard.

Citing other ongoing examples of Republican senators sabotaging ambassadorial nominations to countries key to U.S. security, Ornstein sums up the situation:

This goes beyond partisan polarization to damage to the fabric of governance and worse — to damage to the vital interests of the United States. ...

[S]hame on a Senate which went from blocking a well-qualified nominee for an appeals court judgeship via filibuster to blocking a superbly qualified nominee for the consumer bureau, to yet another in a series of ambassadors stymied via holds and filibusters. This is no way to govern.

PFAW

With Nominations, the Senate GOP Legislates by Gridlock

This piece originally appeared in the Huffington Post.

The Senate GOP under President Obama has mastered the art of proactive apathy. Not content with neglecting their own jobs, Senate Republicans have expertly used their own dysfunction to prevent other parts of government from doing theirs. These efforts have consequences far beyond bureaucratic procedure: whether it's by crippling the courts or attacking agencies that hold corporations accountable, Republicans are making it harder for individual Americans to access the rights that a functioning government protects.

This week, Senate Republicans added two new public disservices to their resume. On Tuesday, they shattered the 2005 "Gang of 14" deal that prevented filibusters of judicial nominees in all but extraordinary circumstances, setting a standard that no nominee for the D.C. Circuit will be able to meet. As President Obama said about the filibuster of Halligan's nomination, "The only extraordinary things about Ms. Halligan are her qualifications and her intellect." And then on Thursday, they blocked President Obama's nominee to head a new federal agency simply because they do not want that agency to exist -- a move that will have untold consequences on future attempts to staff the executive branch.

These political power plays by a minority of senators are far more than "inside the Beltway" procedural dust ups. They signal the emergence of a party that is so intent on tilting the playing field in favor of the powerful that they will sacrifice basic public service in order to serve the interests of a powerful few.

On Tuesday, all but one Senate Republican refused to allow an up-or-down confirmation vote on Caitlin Halligan, a D.C. Circuit Court nominee who in any other year would have been easily approved by the Senate. The GOP struggled to find a reason to oppose Halligan on her merits, ultimately settling on a handful of trumped-up charges and the ridiculous argument that the D.C. Circuit, with one third of its seats vacant, didn't need another judge. When George W. Bush was president, many of these same Republicans loudly proclaimed that filibustering judicial nominees violates the United States Constitution, ultimately agreeing to the "Gang of 14" deal that judicial nominees would only be filibustered under "extraordinary circumstances." The vote on Halligan shattered that deal, opening the door for further political abuse of the judicial confirmation process.

On Thursday, the story repeated itself when the GOP succeeded in blocking a vote to confirm Richard Cordray to lead the newly created Consumer Financial Protection Bureau. Cordray, the former attorney general of Ohio, is as non-controversial as they come. He has a history of working with banks and with consumer advocates. He's backed by a bipartisan coalition of attorneys general, including the Republican who beat him in last year's election. Republicans in the Senate don't have any problems with Cordray. But they've made it very clear that they'll do everything in their power to keep the Consumer Financial Protection Bureau from performing the functions that it is required by law to carry out. They don't want anyone to lead the agency, because without a Senate-confirmed head, it cannot perform all of its legally assigned duties. This is not conjecture on the part of progressives; Republicans have brazenly admitted it.

Unfortunately, these votes are not aberrations. They are part of a clear pattern of the Senate GOP since President Obama's election. Unable to accept the results of an election they lost, and unable to get their own way on everything, they have resorted to obstruction and dysfunction. They have abused the extraordinary power the Senate minority is granted , blocking everything they get their hands on, sometimes, it seem, simply because they can. In the process, they are damaging America's system of justice and accountability and betraying the voters they were elected to serve.

Perhaps they are doing this to serve the powerful corporate special interests that do not want courts and agencies to hold them accountable, or perhaps they are doing it to score political points against a Democratic president, or some combination of those reasons. Ultimately, it doesn't matter. Either way, they are abusing their positions and throwing sand in the gears of the Senate to make it harder for ordinary Americans to get our day in court and to defend ourselves against the powerful. It's a deeply cynical strategy, and ultimately a deeply harmful one.

PFAW

In Tight Race with Elizabeth Warren, Scott Brown Bucks Party to Endorse Cordray for Consumer Financial Protection Bureau

Last month, PFAW’s Marge Baker wrote an op-ed for The Hill suggesting a simple way that Congress can respond to the energy behind Occupy Wall Street: by finally confirming Richard Cordray to head the long-languishing Consumer Financial Protection Bureau. Marge wrote:

Thanks to Republican obstructionism, the CFPB, tasked with holding big banks accountable to American consumers, has been without a leader since it was created by the Dodd-Frank Act last year. Elizabeth Warren, who conceived of the agency and oversaw its creation, would have been the natural fit to lead it, but her unapologetic work holding financial institutions accountable put her on the bad side of Congress’s GOP leadership.


In July, President Obama nominated former Ohio attorney general Richard Cordray to head the agency. Cordray is a strong defender of consumers who has also earned respect from the banks he worked with in Ohio. Last week, a bipartisan group of 37 state attorney generals wrote to Congress urging his confirmation. Even Ohio’s Republican attorney general Mike DeWine, a former U.S. senator who defeated Cordray in last year’s election, has endorsed him for the job. He is a well-respected, reasonable and eminently qualified choice to lead the agency.

Cordray’s nomination would be a shoe-in if it weren’t for one thing: Republicans in Congress don’t want the Consumer Financial Protection Bureau to exist at all. Unable to stop its creation, they have turned their energies to starving it. In May, 44 Republican senators sent a letter to the president saying that they would not confirm any nominee to head the CFPB unless the agency was first substantially weakened. Without a confirmed leader, the agency can’t fully start the work that it was designed to do.


While the agency is already overseeing credit companies and big banks, it can’t have its full oversight over mortgage companies and payday lenders until a head is confirmed. This situation is perfectly satisfactory to big lenders and the GOP leadership – but it’s bad for American consumers.


There is now one notable exception to the Republican blockade of Cordray’s nomination. Massachusetts Sen. Scott Brown, who is running against CFPB architect Elizabeth Warren in what will likely be a tough reelection race, has urged his fellow GOP senators to break their filibuster of Cordray’s nomination.

Brown’s in a more precarious political position than many of his Republican colleagues, but his endorsement of Cordray is telling. Recent polls have shown that Americans are concerned about the nation’s increasing income inequality and want tougher government regulation of Wall Street. The big banks may not want the Consumer Financial Protection Bureau to get up and running, but American consumers are eager for the protections that the bureau would provide. Sen. Brown has done the right thing by bucking his party to support Cordray – but by doing so he’s also acknowledging the tough spot that opponents of financial sector accountability may find themselves in in 2012.
 

PFAW

Darrell Issa's Two Hats

Rep. Darrell Issa’s ties to big business run deep, and as chairman of the House Oversight and Government Reform committee, Issa has functioned quite efficiently as an arm of a Wall Street lobbying shop. He has demanded that government regulators back off from applying new rules to Goldman Sachs, and he has fought tooth-and-nail to deny the new Consumer Financial Protection Bureau, and its yet-unconfirmed director Rich Cordray, any significant means to protect the public from fraud and abuse by the financial industry.

It’s (unfortunately) expected that members of Congress will take pains to protect their favored constituencies, but Issa has taken the overlap of money and politics to a new extreme. Issa’s deep ties to Wall Street are not a figment of his distant past – to this day he is so deeply beholden to Wall Street’s interest that it is difficult at times to discern which hat he is wearing – his investment tycoon hat or his chairman-of-one-of-the-most-powerful-committees-in-Congress-responsible-for-holding-corporations-and-the-government-accountable hat.

For example:

  • While Issa fought to block the SEC investigation of Goldman Sachs, he quietly bought $600,000 worth of Goldman Sachs bonds.
  • While Issa was accusing the Treasury of a “cover-up” in their role in Bank of America’s purchase of Merrill Lynch, he didn’t mention that he had completed transactions with Merrill Lynch totaling $1 billion over the last decade.
  • Many of Issa’s staffers epitomize the K-Street ‘revolving door.’

But the most troubling symptom of Issa's rapid swapping of hats is that the American people suffer when the Oversight committee fails to do its job  outcomes of investigations are pre-determined. When the committee -- at Issa’s direction -- investigated the FCIC for finding the “wrong” causes of the financial crisis, Issa simply cancelled the hearing when the investigation turned up examples of wrongdoing by Republicans. In other words, anything that, in the words of Issa's spokesman, “doesn’t fit the narrative,” was thrown out and what could have been an important investigation was postponed indefinitely.

As more and more examples of Issa’s eagerness to put corporations before people and Wall Street before Main Street rise to the surface, the American people will surely demand that those charged with making sure everyone plays by rules do so themselves.

PFAW

Rep. Issa's Public Sector Job and Private Sector Interests Overlap

Congress may be on summer vacation, but Rep. Darrell Issa, chairman of the House Oversight & Government reform committee, is still quite busy with his other job. In addition to heading one of the most powerful committees in Congress (which one might consider a full-time gig), Rep. Issa “moonlights” as an entrepreneur and investor. He is quite successful: Issa’s recently-disclosed net worth is closing in on $1 billion. Most employers don’t care what their workers do in their personal time, as long as it doesn’t interfere with their job responsibilities. However, in Issa’s case, there seems to be a fair amount of overlap – and this raises more than a few ethical questions.

Rep. Issa is well known for his willingness to bend over backwards to support corporate supporters. From writing letters to big corporations asking which pesky regulations they would most like to do away with to slamming the new Consumer Financial Protection Bureau for protecting ordinary people, Issa always looks out for the money-making interests of his most high-powered constituents. However, it appears that Issa is also using his government perch to stack the deck in favor of his personal private sector interests, such as securing federal earmarks for highway projects that have significantly increased the value of properties he owns. Here’s an excerpt are some details from a new report published over the weekend by the New York Times:

Even as he has built a reputation as a forceful Congressional advocate for business, Mr. Issa has bought up office buildings, split a holding company into separate multimillion-dollar businesses, started an insurance company, traded hundreds of millions of dollars in securities, invested in overseas funds, retained an interest in his auto-alarm company and built up a family foundation.

As his private wealth and public power have grown, so too has the overlap between his private and business lives, with at least some of the congressman’s government actions helping to make a rich man even richer and raising the potential for conflicts.

He has secured millions of dollars in Congressional earmarks for road work and public works projects that promise improved traffic and other benefits to the many commercial properties he owns here north of San Diego. In one case, more than $800,000 in earmarks he arranged will help widen a busy thoroughfare in front of a medical plaza he bought for $10.3 million.

His constituents cheer the prospect of easing traffic. At the same time, the value of the medical complex and other properties has soared, at least in part because of the government-sponsored road work.

But beyond specific actions that appear to have clearly benefited his businesses, Mr. Issa’s interests are so varied that some of the biggest issues making their way through Congress affect him in some way.

After the forced sale of Merrill Lynch in 2008, for instance, he publicly attacked the Treasury Department’s handling of the deal without mentioning that Merrill had handled hundreds of millions of dollars in investments for him and lent him many millions more.

PFAW

CFPB finally opens its doors: A welcome sign of true financial reform

Exactly one year after the Dodd-Frank Act was signed into law, the much anticipated Consumer Financial Protection Bureau (CFPB) is open for business. The agency is part of the response to calls for much tougher oversight and will protect consumers by pursuing businesses that practice wrongful and abusive tactics.

The bureau’s chief architect, Elizabeth Warren, is a highly regarded consumer advocate who assembled a talented and dedicated team to build from scratch a consumer advocacy agency in the span of one year. Millions of Americans will benefit from the tremendous work she and her team has done to build this critical agency. The CFPB’s Office of Servicemembers Affairs is an especially important branch within the agency, whose mission is to ensure that our men and women in uniform will not have to deal with certain stresses while overseas, such as the wrongful foreclosures many soldiers and their families have unfortunately experienced.

Unfortunately, however, the agency is off to a rough start. Though President Obama named fierce consumer advocate Richard Cordray to head the agency, on its inaugural day, the CFPB is without an official director. Senate Republicans claim it could be for some time, as they block any nomination for the bureau’s top job and the House continues its work to dismantle—and if possible, even repeal—the Dodd-Frank Act.

This new consumer advocacy group is essential to the economic wellbeing of the American people and the nation as a whole. During these troublesome economic times, thousands of once, hardworking men and women struggle to find jobs, face foreclosures, and struggle to make ends meet. The CFPB cannot necessarily get them out of these unfortunate situations, but it can certainly protect them from the continued fraudulent and abusive practices of greedy corporations that got them into this mess.

Americans need someone who will stand up for them as they continue working to recover from this terrible economic mess. With talks of a possible “double-dip recession,” it is more important than ever that our leaders in Washington make it clear that they are on the side of the American people and willing to do whatever to protect consumers and put this country’s economy back on track.

PFAW

Republican Obstructionism Knows No Bounds

We’ve seen Republican Obstructionism at work against our federal judicial system, as Sen. Mitch McConnell and his cohorts have blocked many exceptionally-qualified, mainstream jurists from receiving an up-or-down vote in the Senate and many more have been needlessly delayed. But his recent comments regarding the fledgling Consumer Financial Protection Bureau, which still is without a director, unequivocally shows that his priority is to prevent President Obama from building a functioning government that serves the American people. Unfortunately, this means handicapping the CFPB – which was created to help protect Americans from the types of financial abuse by Wall Street that caused the Great Recession and is toothless without a director – just to score political points and curry favor from the financial industry.

Raw Story reports:

President Barack Obama has decided to nominate Richard Cordray to head the Consumer Financial Protection Bureau (CFPB) instead of Elizabeth Warren, but Senate Minority Leader Mitch McConnell (R-KY) doesn’t care. He says Republicans still plan to block the nomination.
“I would remind [President Obama] that Senate Republicans still aren’t interested approving anyone to the position until the president agrees to make this massive government bureaucracy more accountable and transparent to the American people,” McConnell announced on the Senate floor Monday.

By making the agency “more accountable and transparent,” Sen. McConnell and other Republicans mean replacing the director with a board of directors and making it easier for other agencies to overrule the CFPB’s actions – in other words, providing more opportunities for the financial industry to insulate itself from oversight and regulation.

It’s pretty easy to see how the Obstructionist agenda might not be in the best interest of the American people.

PFAW