When asked about the “Occupy Wall Street” movement in October,
Massachusetts Senate candidate Elizabeth Warren praised it to the
hilt. “I created much of the intellectual foundation for what they
do,” she
told the Daily Beast. Yet when pressed in November on the OWS
adherents’ increasingly violent tactics, she
told a Boston TV interviewer: “Everybody has to follow the law.
There’s no exception on that.”
But Warren’s apparent disavowal of the tactics of OWS and
like-minded community organizers may not be shared by Richard
Cordray, President Obama’s nominee to head the Consumer Financial
Protection Bureau that Warren designed. Cordray has long supported
ESOP, formerly known as the East Side Organizing Project, an Ohio
housing advocacy group that has distinguished itself by storming
into banks and launching plastic “shark attacks” on the lawns of
private homes. ESOP’s leaders brag about what they call their
“organized hits” on banks and other targets, which have included
the home of the late Congressman and Housing and Urban Development
Secretary Jack Kemp.
As Ohio treasurer and attorney general, Cordray lobbied
for state and federal funding for ESOP and publicly praised funders
of the group as “the real heroes.” And in a highly unusual move for
a nominee awaiting confirmation, Cordray returned to Ohio in
October to be the keynote speaker at the group’s gala
dinner.
Since his nomination in July to head the bureau created by
the Dodd-Frank financial “reform” law, Republicans have held fast
against confirmation. But largely, they haven’t made Cordray’s
state record an issue. They have focused instead on structural
defects in the agency’s design, such as the massive new powers the
bureau will have to ban financial products it deems “abusive” and
its lack of accountability to Congress.
These criticisms are valid, but they may not be enough to
hold Senate Republicans together without criticism of the nominee’s
merits. Just before Thanksgiving, Scott Brown (R-Mass.), facing a
tough reelection challenge from Warren, became the first GOPer to
commit to voting for Cordray. The Democrat-controlled Senate plans
to hold a vote on his confirmation this week, possibly as early as
Tuesday. Human Events’ Neil McCabe reports that
in addition to Maine Sens. Susan Collins and Olympia Snowe, other
GOP targets for Cordray supporters include Alaska’s Lisa Murkowski,
Tennessee’s Bob Corker, and Cordray’s home state Senator Rob
Portman of Ohio (though Portman seemed to reaffirm his opposition
in a
statement to Human Events last week).
But Cordray’s support of ESOP needs further scrutiny,
particularly since as head of the bureau, he will have the power to
help funnel federal support to ESOP and like-minded community
organizers with virtually no oversight by Congress. And a report by
Bloomberg News suggests that Cordray specifically blessed ESOP’s
“organized hits” on banks and homes.
As
reported by Bloomberg upon Cordray’s nomination in July, “Mark
Seifert recalls being impressed when Richard Cordray, then the Ohio
state treasurer, walked into the offices of his Cleveland activist
group one day in August 2007.” Seifert recalled warning Cordray:
“We are not necessarily safe for the powers-that-be to hang around
with. We do direct action. We throw plastic sharks at
bankers.”
According to Bloomberg, “‘Far from being aghast, Cordray
approved of the tactics [emphasis added] and said the
small, Cleveland-focused group should expand,’ Seifert recalled.”
Since that time, the community organizing group, which has changed
the full name underlying its acronym to Empowering and
Strengthening Ohio’s People, has expanded to more than 10 offices
across the state and grown its staff from five to about
40.
ESOP’s growth is due in no small part to Cordray’s
support. According to the
Cleveland Plain Dealer, as state treasurer and AG, Cordray
“helped them find grants to expand.” With state and federal funding
that Cordray helped secure, ESOP grew from a “little ACORN” — to
borrow the phrasing of
Subversion Inc. author and TAS contributor
Matthew Vadum — into a powerful tree. But its core is still rotted
by its tactics of threats and intimidation.
In fact, national Leftie pundits praise ESOP for taking
militant “direct action” to whole new levels. As the Huffington
Post recently
put it, “ESOP takes a civil approach, but stops at nothing to
get lenders to negotiate options for homeowners who face
foreclosure.” In other words, the group is civil until it
isn’t.
As the New York Times recently
described ESOP’s actions in a glowing opinion profile, after
demonstrating in front of a lender’s office, ESOP “would fill a bus
with community members, drive out to the suburban house of a
regional vice president and demonstrate there. ESOP’s signature
tactic was to throw hundreds of two-inch plastic sharks on the lawn
and circulate flyers saying, ‘Your neighbor is a loan
shark.’”
Although ESOP may not do as many organized “hits” as it
did in the past — their last major “hit” seemed to be a storming
of JPMorganChase bank branches in 2009 with busloads yelling “Chase
Bank Sucks” — group leaders make it clear that it’s a tactic in
their arsenal. When negotiation “doesn’t work, that’s when we
really start to have fun,” an ESOP employee
told the Press, a Toledo, Ohio newspaper, in late
2010. “It’s an organized hit.” ESOP founder Inez Killingsworth
stressed to the New York Times: “The word has gotten
around. Now, most of the time we ask for a meeting, we get a
meeting.”
Killingsworth, still active with ESOP as board president,
first gained fame for a threatened “hit” in the '90s on the home of
Jack Kemp, then secretary of Housing and Urban Development in the
first Bush Administration. Killingsworth and other housing
advocates visiting the Washington, D.C., area threatened to disrupt
Kemp’s daughter’s wedding being held at the family home. “Then all
of a sudden, he calls us to say he’ll meet us if we promise not to
hit his daughter’s wedding,” Killingsworth recounted to the
Cleveland Plain Dealer in 1992. Kemp met with the
“advocates” a few months later.
Cordray continued to embrace ESOP during his Ohio
political career and even during his current nomination fight. At
an Ohio housing summit in 2009, Cordray showered praise on the
government agencies that funded ESOP. “A number of community groups
working with homeowners, especially ESOP, got more funding and
local agencies have been the real heroes,” Cordray said in a
statement reported by the Gannett-owned Mansfield (Ohio) News
Journal (story available
here with a fee).
If confirmed as director of the consumer bureau, Cordray
will have plenty of chance to be such a “hero” and to throw federal
support ESOP’s way. In addition to its broad powers from Dodd-Frank
to ban any financial product it deems “abusive,” the bureau has
authority to hire “contractors” to help with consumer issues. And
as most Republicans have pointed out in their objections to
approving a director, the bureau gets a guaranteed independent
stream of funding from the Federal Reserve, denying Congress the
oversight through the appropriations process that it has with other
agencies.
Cordray seemed very eager to address ESOP, returning to
Ohio in October to address what the Cleveland Plain Dealer
described as the group’s “annual gala and silent auction” at
the Cleveland Marriott Downtown. Strangely, neither the Plain
Dealer nor other media reported on the contents of Cordray’s
speech, nor can one find it on ESOP or the consumer bureau’s
website. So much for transparency!
ESOP, not surprisingly, is fighting hard for Cordray’s
Senate confirmation. In a remarkable
interview with Human Events’ McCabe, ESOP executive
director Mark Seifert pooh-poohed concerns about lack of
congressional oversight. Conceding that “the CFPB will have a lot
of power,” Seifert then exclaimed, “Congress sat silent for 10
years, now all of a sudden they want oversight? Go to hell,
no!”
But it is not only Congress whose oversight would be
curtailed if Cordray is confirmed, but the next presidential
administration as well. Once confirmed, Cordray (with likely
influence from ESOP) will be in power until late 2016. That would
cover nearly the entire term of the next president, whoever he or
she may be.
Under Dodd-Frank, McCabe explains: “The director would
serve a five-year term that overlaps presidential terms. This
means, an incoming president could not appoint his own director,
nor does the director serve at the pleasure of the
president.”
