A Fighting Chance

The CFPB was a high-profile operation, so the attacks could come from anywhere. At the agency we spent days preparing for my appearance. My staff warned me that I needed to be ready to answer questions about anything and everything. What policies were we putting in place for enforcement? What was our hiring process? How were salaries set in the federal bureaucracy? (I actually did get a question on that.) The staff put together several giant briefing books, which I read late into the night. I prepared written testimony, producing a document of more than thirty pages that provided a detailed account of our work. We had spoken often of our commitment to transparency, and we were doing our best to be an open book with the public and with Congress.

When the day of my appearance finally arrived, I took a seat at a table in a hearing room for the House of Representatives. Members of Congress sat behind a raised dais, a number of them seeming to glare down at me. C-SPAN cameras blinked from the corners, but it was the guys carrying professional cameras with big telephoto lenses who made me want to throw a blanket over my head. They are not allowed to stand up and block the views of members of Congress, so a protocol has developed where they scoot on their behinds along the floor and take photos from below the dais. I figured that all the newspapers would run flattering pictures of my nostrils the next morning.

Appearing in front of a panel of mostly hostile members of Congress is like testifying in court—everyone is on edge and very formal. The agency was off to a strong start and we hadn’t done anything wrong, but I sure felt as if I were on trial.

Most of the questions from Republicans concerned the foreclosure scandal. In particular, several of the representatives asked why I had offered advice about the bank settlement. They didn’t ask nicely. Whatever their words said, their tone said, “How dare you!”

The Democrats did their best to defend the agency, but for the most part it was two and a half hours of the same questions over and over, with each attacker working on his or her five-minute turn in the C-SPAN spotlight.

Over the next three months, I would be called back to the House to testify two more times. The second hearing was dubbed “Who’s Watching the Watchman.” Each session was worse than the last. After one hearing, a reporter observed that several members of Congress “seemed to lack the basic facts about the new agency they were trying to oversee.” One congressman was confused about how long other bank regulators serve in office; he accused the CFPB of being the only banking agency whose head served a five-year term (not true: several others do, too). He also didn’t understand the rules for how funding is set in Washington and seemed to think the agency was the only banking regulator that was outside the political appropriations process (not even close: all of them are). Another congressman asked me to explain what was meant by a clause in the Dodd–Frank Act, as if I had enacted the law instead of Congress itself.

That was embarrassing enough, but then Congressman Patrick McHenry, a Republican from North Carolina, flatly accused me of lying. Not lying about anything substantive, but lying about our previously agreed-upon schedule.

I had triggered this outburst unintentionally. All the members of Congress in the room had finished asking their questions, and I asked to be excused, noting that we had arrived at the agreed-upon end time for the hearing. Congressman McHenry declared: “You’re making this up.” Huh? He got pretty worked up about it. Congressman Elijah Cummings seemed genuinely appalled and tried to calm down McHenry, but it didn’t work. McHenry “absolutely blew a gasket” (or at least that’s how Rachel Maddow described it when she ran the video later that day).

The video of the hearing went viral, and the congressman’s Facebook page was overrun with tens of thousands of angry messages. I was surprised that so many people paid attention to the incident, and I felt a little embarrassed. In retrospect, I should have just stayed for as long as he wanted to make me sit there. But the whole thing—from the first attack to the YouTube moment—made me feel like Alice in Crazyland.

As the manufactured “scandal” about trying to hold the mortgage companies accountable continued to excite the Republicans, Secretary Geithner got a lot of questions about the consumer agency’s role. By now, he had a pretty good view of what the agency could do. Our work was still in the preliminary stages, but I think it was becoming clear that we were building tools that would help make the credit markets work for families.