Warner concerned Obama agency may be ‘gotcha’ enforcer

Sen. Mark Warner, D-Va.,  expressed concern that President Barack Obama’s proposed Consumer Financial Protection Agency, centerpiece of a rules overhaul, is “divorced” from markets and would be a “gotcha” enforcer.

“Is this going to be some kind of poor cousin, located across town, that will always be struggling to have the resources, personnel and expertise?” Warner, a Democrat on the Senate Banking, Housing and Urban Affairs Committee, said.

Another concern is that the agency, “divorced from the reality of the market and the reality of the financial institution, becomes so focused on a gotcha mentality that it overdoes,” Warner said. He said he may be “convinced” to back the agency.

Warner endorsed Sonia Sotomayor, Obama’s nominee to the Supreme Court whose Senate confirmation hearing begins July 13.

“She is extraordinarily qualified,” the Virginia senator and former governor said. “I intend to vote for her unless I hear other things that would come out of the hearing.”

Warner, elected last year, hadn’t commented on the nomination of Sotomayor, 54, and said the U.S. Court of Appeals judge from New York will be confirmed. He also predicted the Senate will overhaul health care and pass a climate-change measure that would set limits to cut greenhouse gas emissions tied to global warming. “I would put the odds on both of those way north of 50-60 percent,” he said on the broadcast.

The Obama administration is seeking to give the consumer agency broad powers over companies that issue mortgages and credit cards in the revamp of financial rules after the worst crisis since the Great Depression. Warner conceded consumers have gotten “short shrift” from bank regulators and said “ideally” each regulator should have a consumer division.

On health care, Warner said he was open to tax increases to overhaul the system. Proposals such as one by Senate Finance Committee Chairman Max Baucus, a Montana Democrat, to tax some employer-provided health benefits for the first time should be “part of the mix,” he said.

“At the end of the day, you’ve got to pay for health care,” Warner said. “The more you can have a nexus, the more palatable it becomes.”

Warner said he is “intrigued” by the idea of a state or national health insurance cooperative to provide additional competition. “What we ought to be having is a competitive-based system.”

On climate change, Warner said there are ways the Senate can improve on the House measure passed last month. “I want to get to a bill that I can vote for,” he said.

Warner said any measure has to ensure that U.S. businesses stay competitive with foreign rivals and that certain regions of the country, such as the South and Midwest, aren’t “disproportionally hurt.”

Warner praised Obama for “heading in the right direction” on the economy. The “Achilles’ heel” is the deficit and a sense government is spending too much, he said.

“The jury is still out whether we’re going to be able to get more discipline around spending,” he said.