This is the Cato Daily Podcast for Wednesday, January 11, 2012. I'm Caleb Brown.

It's not clear that President Obama's recess appointments have been constitutional,

though that's not the only problem for one appointee. Mark Calabria, Director of Financial

Regulation Studies at the Cato Institute Institute offers his thoughts.

On January 4th, President Obama made a variety of recess, so-called recess appointments, one of which was for Richard Cordray, former Attorney General of Ohio, to head the new the created Consumer Financial Protection Bureau, which was created under Dodd-Frank.

And of course, there are caveats to the power of the Bureau that do not come into effect until

it has a director in place.

The purpose of the Bureau was essentially to consolidate existing consumer

financial protection into one agency as well as expanding that oversight to

non-bank financials, things like payday lenders or check cashers and such.

And so the president sent the nomination up,

but it was rejected by the Senate in terms of not being able to reach cloture.

And then of course the Senate sent the nomination back to the President

then the President being unhappy with that to say to quote unquote make a

recess appointment. Some members of Congress are arguing that this person

based on the language of Dodd-Frank actually is not going

to be able to do much of anything. There are a couple of issues here and of course he can do a

variety of things in terms of bank regulation because the powers of Dodd-Frank that relate to the bank

regulators, things like Respa Truth in Lending that the Federal Reserve implemented do transfer

over.

And so there's two separate issues here,

rather at least two separate issues.

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