July 22, 2010 -- Treasury Secretary Timothy Geithner has frequently clashed with Wall Street bailout watchdog Elizabeth Warren, but today he praised her work on financial reform and said she would be "a very effectively leader" of the powerful consumer protection agency to be created under the new Wall Street reform law.
"She is one of the most effective advocates of reform in the country," Geithner told reporters at a breakfast sponsored by the Christian Science Monitor. "She has enormous credibility. ... I think she would be an very effective leader of that institution."
But even as he praised Warren, Geithner made it clear he has not endorsed her to run the agency.
"You heard me praise her as an effective leader," Geithner said. "We have not yet made a recommendation to the president" about who should run the new agency.
The White House has mentioned two others as possible candidates for the job: Treasury official Michael Barr and Eugene Kimmelman at the Justice Department.
"Those are excellent candidates," Geithner said, referring to Barr and Kimmelman. "And I am sure there are others too."
In her role as the head of a Congressional oversight panel on the banking bailout, Warren has been unsparing in her criticism of Geithner's Treasury Department. Just this week she slammed Geithner's $75 billion foreclosure prevention program, telling a Senate panel on Wednesday that the foreclosure program is "behind the curve" and, "We need a program with far more urgency and some real teeth in it."
Some prominent lawmakers, progressives and labor unions in Washington want the White House to tap Warren, who is also a Harvard Law professor and has led the charge for greater consumer protections. That would make sense -- after all, the agency was Warren's brainchild. It was Warren who in 2007 proposed the creation of "a new regulatory body to protect consumers who use credit cards, home mortgages, car loans and a host of other products."
Despite Geithner's praise today, it is clear that some members of the administration don't want Warren to be offered the post and, perhaps just as importantly, some members of Congress believe she could be too controversial to win Senate confirmation.
Sources have told ABC News that Geithner has had concerns with Warren, especially for her criticism of the Obama administration's handling of TARP.
Senate Banking Committee Chairman Chris Dodd has raised doubts about support for Warren on Capitol Hill.
"Elizabeth, I think, can be a terrific nominee. The question is, 'Is she confirmable?'" Dodd said in an interview on National Public Radio earlier this week. "And I think there's a serious question about it."
That way of thinking, noted syndicated progressive newspaper columnist David Sirota, raises the question: What is the definition of "controversial" in today's Washington?