DAVID GREENE, host:
From NPR News, this is ALL THINGS CONSIDERED. I'm David Greene.
ROBERT SIEGEL, host:
I'm Robert Siegel.
And first in this part of the program, the head of a new federal agency, an agency that she conceived of, and one that she says can save taxpayers billions of dollars. Her appointment was opposed by many in the financial sector that she will regulate.
Elizabeth Warren is a Harvard law professor and longtime friend of President Obama. She ran Congress's oversight of the TARP program, which aided banks and car companies, and now, she is setting up the Consumer Financial Protection Bureau.
By next year, it's supposed to be up and running and housed at the Federal Reserve. For now, she's operating out of the Treasury Department, where we spoke this morning.
Professor Warren, welcome to the program.
Ms. ELIZABETH WARREN (Special Adviser, Consumer Financial Protection Bureau): Thank you.
SIEGEL: And first, before talking about the substance of what your bureau is going to do, I want to talk about your status a bit.
Ms. WARREN: Okay.
SIEGEL: You are a special assistant to the president, special adviser to the Treasury secretary. This was seen as a way to avoid a confirmation battle in the Senate. In that status, can you actually start and direct a federal agency?
Ms. WARREN: Actually, I don't think - I don't know whether this was about avoiding a confirmation battle or not. That's a political question. You got to ask people who understand politics better than I do.
From my perspective and from my conversations with the president, what this is about is getting to work immediately. I'm told that if I had been nominated, that two things would have happened. The first is that I could not have worked on the agency for months and months, possibly over a year. And the second is that I would not be allowed to talk about it. And so the question was, would the president nominate me and sort of put me in a pumpkin shell for a while, or could I get started to work immediately? And my own enthusiasm was I'd really like to get to work right now.
SIEGEL: Some of your - actually, supporters and critics of this agency think it needs a leader who is fully confirmed. Some of the critics - David Hirschmann of the Chamber of Commerce says that the maneuver of appointing you without confirmation is an affront to the pledge of transparency and consumer protection that's purported to be the focus of this new agency.
Ms. WARREN: You know, the Chamber of Commerce fought the creation of this agency every inch of the way, and the chamber would like as much delay as possible before this agency gets underway. And a nomination process, in which one senator could put a secret hold, could delay for a very long time this agency getting underway.
And let's remember what that translates into. That's literally billions of dollars for American families. I mean, that's what really on the table here. It's money, and it's whether or not money stays in the pockets of the families or whether or not this money drains out into the pockets of some very large financial services companies. That's what's really at stake here.
SIEGEL: I'd like you to explain to people the mission of this bureau. For example, as you understand it, if a bank is charging outrageously high fees for overdrafts, can you say to the bank stop that? Or is that the regulator's role and you can tell consumers that bank is charging outrageous fees for overdrafts?
Ms. WARREN: I want to say it slightly differently. I think the problem we've got right now in the consumer credit market is that the market is broken. And so what would make a market work if - let's take credit cards as an example. You had two pages - that's the whole credit card agreement. The terms are clear and flat and easy to see. Anyone can read them. So that you could lay four credit card agreements in front of you and say, oh, that's the one that has the highest rate, that's the one that has the really scary provision that could hurt me.
Now, you get a market that starts to work again, so consumers can make better choices. We've lived in a world in which disclosure was piled on disclosure was piled on disclosure. And the reality was nobody could see or read or understand those products and didn't want to. I was just looking at one yesterday, credit card agreement, 41 pages long. This agency has the capacity to drive the credit card companies and other credit issuers toward the kinds of agreements where consumers can say, oh, that's what the deal is. That's what it costs.
SIEGEL: You would have the ability then to create a standard form that presents the terms of a credit card, and every credit card would have to fill in the information?
Ms. WARREN: Well, the point is to have standardized information that's available. It doesn't mean you have a standardized credit card. One credit issuer might decide to charge 16 percent. Another one might decide to charge eight percent. But the point is neither one of them is making huge revenues on a bunch of stuff that's hidden back on page 14 that no consumer can see and that's not involved in competition.
SIEGEL: This new bureau seems to be something that could either have sweeping authority that reaches into many existing regulatory agencies, deep into basic transactions in our lives - how we buy things, how we buy a home, how we borrow money. $500 million, 500 people could also turn into, if it gets off to a slow start, some backwater that issues press releases and makes people feel good.
In your status here at Treasury - you're not even at the Fed yet, where this is supposed to be based - can you make this an agency that changes people's lives and their finances?
Ms. WARREN: Yes. It is the job of this agency to get those markets working again and to wind out of it the tricks, the traps, the fine print, the sorts of things that have become the source of profit for the industry and loss for the family. It won't fix everything that's broken, but for a lot of families, it's going to make a powerful difference.
SIEGEL: Elizabeth Warren, thank you very much for talking with us.
Ms. WARREN: Oh, thank you for having me.
SIEGEL: Elizabeth Warren has been tasked with setting up the Consumer Financial Protection Bureau.
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