Obama Pulls an Agency Out of His…Hat

Rhetorical sleight of hand on the new Consumer Financial Protection Agency

"Notice that I am not touching the cards," the magician says, handing the deck to an audience member to shuffle. Another audience member cuts the deck. The magician scribbles on a piece of paper while standing on the far side of the room, noting once again that he is not touching the deck. A third person draws a card. A fourth unfolds the paper to reveal that the magician has correctly guessed the 10 of clubs. The audience gasps. How did he do it without touching the cards at all?

Of course, the answer is simple. He did touch the deck. Casually fanning out the deck after the initial shuffler has reflexively handed the cards back to him, the magician comments inanely "Good shuffle. Looks random." Then he sets them on the table (just so) to be cut and strides off, hands where we can see them.

Human beings are excellent at editing our own memories to conform with a suggested narrative. The magician's "reminders" that he has not touched the deck erase from our minds the fact that he had ample opportunity to examine and position the relevant cards before the trick even got rolling. Part of the fun of the magic trick is when the magician asks his duped audience to recount the chain of events: No matter how carefully they retrace their steps, they omit the incident where he touched the deck simply because they know for sure he never touched the deck. It's called "provoked confabulation," and this particular gambit is on display, sans Bicycle deck, in the current debate over the creation of the Consumer Financial Protection Agency and the rest of President Barack Obama's proposed financial regulatory reforms.

In this case, it's about casting adversaries of a massive new regulatory body in a bad light. Check out Obama's rhetorical sleight of hand (sleight of mouth?) on Saturday. First this: "Some argue that these changes—and the many others we've called for—go too far. And I welcome a debate about how we can make sure our regulations work for businesses and consumers."

The message here is clear. Obama is not like bad old George W. Bush, who was always stifling debate by talking about national security and 9/11 and stuff. (George Bush used exactly the same trick, of course, occasionally noting how much he loved debate in wartime. Bush got a fair amount of media pushback, though.) No siree, Obama welcomes debate. But then he says this: "But what I will not accept—what I will vigorously oppose—are those who do not argue in good faith. Those who would defend the status quo at any cost. Those who put their narrow interests ahead of the interests of ordinary Americans. We've already begun to see special interests mobilizing against change. That's not surprising. That's Washington."

Listening to Obama's speech, we walk away with a vague sense that opposing the creation of a big new regulatory body to oversee banking somehow places one in league with, "interests that have benefited from a system which allowed ordinary Americans to be exploited," as Obama went on to describe them. That those who "defend business-as-usual" are doing so under pressure form the special interests sinisterly "mobilizing against change." In fact, even those who are obviously not compromised by any kind of potential financial stake in the legislation (pro-market journalists, say) are also in some way tainted.

But if Obama is challenged on his sly accusation of bad faith, he will simply point to his first statement: He loves debate! He welcomes it. That's what he said, isn't it? He must not be trying to impute bad motives and use ad hominem attacks against his opponents, since we know for sure he likes debate.

In many ways, we're witnessing a replay of the creation of the Department of Homeland Security. Consolidating and streamlining agencies sounds excellent—so what if the government picks up significant new powers along the way?—but it's hard to pull off, and not just because of those meddlesome special interests. Obama's 89-page proposal [PDF] takes a lot of individual powers from existing agencies. Bureaucratic turf wars can be bitter struggles. And while no one in the administration is accusing the Securities and Exchange Commission, or the Treasury Department, or the Federal Reserve of acting in bad faith, folks at those agencies have a special interest in what the new agency looks like, too. Congress is on the job as well, inserting compromises and special favors, soothing egos around Washington, and generally trying to look busy.

But as with the magic trick, the relevant sleight of hand has already occurred with the new Consumer Financial Protection Agency. The debate will be ugly, but the House took up the proposal for the new agency this week, and promises to get something passed by the end of July. The rest is just stage business; the deed is done. It was over before the audience knew the magician had even begun.

Katherine Mangu-Ward is an associate editor at Reason. Thanks and apologies to the confabulous Andrew Mayne for supplying the raw ingredients for today's abused magical metaphor.