President Obama used some back-door maneuvering to bypass a Republican blockade and install Richard Cordray as head of the country's new financial watchdog, the Consumer Financial Protection Bureau (CFPB).  President Obama installed Mr. Cordray through a recess appointment, one month after Senate Republicans blocked a vote on his nomination. While the CFPB existed in form and structure, along with a full staff, it has been powerless without a top director.  Under Dodd-Frank, without a director in place the CFPB could supervise banks but it could not regulate the "shadow banking" industry such as payday lenders, mortgage servicers and private student lenders. Obama also used recess appointments to fill 3 vacant seats on the National Labor Relations Board, installing Sharon Block, Terence Flynn and Richard Griffin.  The Senate had failed to move on their nominations.  Before these additions, the 5-member NLRB lacked enough representation to fully conduct its business in 2012.  Obama's appointment of Cordray and the NLRB nominees is part of a broader White House strategy to portray Obama as an activist president confronted with a "do nothing" Congress that has stymied his economic agenda. Responsibilities of the CFPB. Cordray is a former Ohio attorney general who was not afraid to file legal challenges against banks, including Bank of America.  That experience should come in handy, because the bureau is charged with policing consumer markets for products such as credit cards and home loans. As a recess appointee, Cordray also can only serve through 2013 instead of a full 5-year term, according to the Congressional Research Service.  Even so, he's bound to his more roadblocks put up by Republican Senators. It's questionable how much of an impact the CFPB can have over the next year.  Jaret Seiberg, policy analyst at Guggenheim Securities, said, "I don't think this changes much at the CFPB because the agency is going to be overwhelmed in 2012 with Dodd-Frank rulemakings and setting up and strengthening its bank supervision program." Nevertheless, Democrats have heralded the bureau, which opened its doors in July, as a way to protect consumers from abusive lending practices like the type of home loans that were made in the years leading into the 2007-2009 financial crisis.  Others say much of the bureau's time in 2012, whether Cordray was in the director's chair or not, would be spent building up its operations. Republicans, on the other hand, have demanded structural changes to the agency before they would help confirm a permanent director.  They charge the agency with being a virtually unchecked government body that will hurt lending and put small banks out of business.    [Reuters, 1/4/12]

[See today's related BTN story to learn what Mr. Cordray has immediately targeted.]