President Obama handpicked Harvard professor Elizabeth Warren to create a new federal Consumer Financial Protection Bureau. The two have known each other for years, the president said. Obama didn't nominate her, a move he said was calculated because many of his nominees have struggled for approval in the Senate.
Warren doesn't have to get Senate approval because she is a special adviser.
She spoke with Kiran Chetry and John Roberts on CNN's American Morning.
Chetry: What is your vision for the consumer protection agency? What do you want it to be and to do?
Warren: We have a consumer credit market. It's broken in the sense [that] unlike most markets, when consumers go out to shop [and] decide to take out a credit card or take out a mortgage or car loan, you can't really compare the products because they've gotten long, they've gotten complicated.
They're full of fine print. Here's the bad thing: they've got a bunch of tricks and traps in them. What appears to be the price, low, low, 7 percent financing is really zero percent financing. It's the case [with] some of these lender[s] [that] they're getting a lottery ticket. They're hoping you'll take their low, low price because buried back in the fine print, they intend to make a lot of money.
Chetry: Now, I'm sure it doesn't come as a surprise to you that you have critics in the financial world. Some of them are saying the problem is you're coming from an anti-business point of view and you're not really giving them a chance. And some come from the academic world so you don't really understand the intricacies of how these financial institutions work. How do you respond to those critics?
Warren: Partly, you're right, and I want to learn. So teach me more about how this works. But partly it's to say, I've been studying for 30 years what goes on in the financial services industry and what the products look like and what the impact is on the middle class families. Middle class families expect to pay for services that they receive. They expect to have to be personally responsible for things they put on their credit cards or for the car loans they take out. What they have a right not to expect, what they have a right to object to is when they think they're getting something at one price, and they find out that the real price is the thing buried back in the fine print - all the costs that you don't know, until they've bit you and now it's too late. [I] saw a piece the other day, some of these free credit cards on average [cost] $300 a year.
Roberts: You were appointed to a consultant or advisory position that skirted around that you would need senate confirmation to achieve your position. You said, 'If I get in there right now, I have an opportunity to work right now as opposed to getting through the senate confirmation process.' But can you really have the trust of the people if you don't go through the process?
Warren: The statute specifically provides that someone is supposed to come in and start building this agency. The better way to understand [is that] there were two options. One option is to go ...
Roberts: Okay. But the broader point of whether or not you can really have the confidence of the American people and Congress if you're not confirmed by the senate?
Warren: You know, the question was, if we go to confirmation, I'm not the political person. I don't understand this. I don't understand what goes on in Washington. But if I go to confirmation, what I'm told, it could take even a year, without my getting a hearing. Two terrible things [could] happen in that year: I can't do one bit of work on this agency. I'm completely fenced off from it. And the second is I can't talk about it. When [the] president and I talked about this, he is very committed to the agency. He said, we could go the nomination route, or you don't get as nice a title, because the statute needs someone to get to work.
Roberts: But again, will you have the confidence?
Warren: Well, that's what I'll find out. I'm going to do the best I can. I'll tell you, if I'm not doing my job in a good way, then I ought to be pitched out.
Tune in to American Morning weekdays at 6 am EST for the most news in the morning.
Watch American Morning weekdays 6am to 9am ET. For the latest from American Morning click here.