By Kirk Victor. Originally published on FTC:Watch February 17, 2017
Thomas Pahl was just settling into private law practice after a career in government service when he got a call from his former colleague and good friend, Maureen Ohlhausen.
Ohlhausen, acting chairman of the Federal Trade Commission, offered Pahl the post of acting director of the Bureau of Consumer Protection. It would mean a return to his old stomping grounds at an agency where he had worked for more than 20 years.
Though he was a partner at Arnall Golden Gregory who had joined the firm just five months earlier, Pahl jumped at the offer. And that's despite the dicey proposition of taking a post on an acting basis from Ohlhausen, whose own future at the agency depends on President Donald Trump's decision about whether to make her the permanent chairman.
"The opportunity to lead the Bureau of Consumer Protection is a once in a lifetime kind of opportunity," Pahl said in an interview with FTC:WATCH.
"My hope is other folks out there, particularly one at 1600 Pennsylvania Ave., recognize how great my old friend Maureen is and decide to make her [permanent] chairman — and we'll go on from there," he added. "That certainly is my hope, but sometimes in life you get a once in a lifetime opportunity, you roll the dice, and you do as much good for as long as you can. And, if it ends, it ends."
Pahl knows the agency well, having served in various roles starting in 1990 — including stints as assistant director of the Bureau of Consumer Protection's division of advertising practices and its division of financial practices. He advised former Commissioner Mary Azcuenaga, and in addition, he and Ohlhausen both served as attorney advisers to former Commissioner Orson Swindle, becoming fast friends.
"We thought about legal issues and the world in very similar ways and became very close friends," he said. "0ur families have vacationed together….We have maintained very close contact over the years. So at this point, I have known Maureen for about 20 years. She is one of the special people on the planet."
In fact, Pahl even penned a blog post in The Hill in which he effusively praised Ohlhausen the day after she was named acting chairman. He made the case for her to be appointed to the top spot on a permanent basis.
"As permanent FTC chairman, Ohlhausen would bring to bear a rigorous and consistent application of regulatory humility, limiting the scope of government intervention in the marketplace, and thereby fostering the innovation and economic growth that are at the heart of President Trump's agenda," he wrote on Jan. 26 in a post headlined, "Trump's wise choice for the FTC."
Jessica Rich, the outgoing bureau director, said in an interview that Pahl and Ohlhausen's "longstanding relationship will help them work together effectively and that will be very beneficial to the bureau. It is very important that the chair and his or her bureau director are aligned in their approach and philosophy to consumer protection."
To that end, Pahl, who will assume his post on Feb. 21, said that he will follow Ohlhausen's direction to steer the bureau in a different direction in some cases than it has pursued in recent years.
Pointing to Ohlhausen's recent speeches and writings, Pahl stressed the need to "make sure that we have really concrete examples of harm to support our cases."
Though he said it is a challenge to evaluate past agency enforcement actions from the outside, based on pleadings and orders, Pahl noted that he likely would have handled some matters differently.
"Are there some cases that the FTC went forward with that as far as I can tell, based upon those documents, I may not have pursued? Yes, there are probably some cases," he said.
"At this point, I couldn't go through and articulate which specific ones. But as a general matter, there are some cases where the injury that had been found was less than I would like to see us spending our resources on, and it is probably less than I would like to see before I would recommend that the commission go forward with a case," Pahl said.
"So it is a matter of degree, but certainly there are cases where we probably would not pursue them," he added.
Some consumer advocates are worried by such statements, especially when they are coupled with some of Pahl's recent blog posts that stress deregulation themes and call for consideration of restructuring the Consumer Financial Protection Bureau. The CFPB is fiercely defended by Democrats for its aggressive consumer protection agenda, but aggressively derided by Republicans as a runaway agency that is insulated from congressional oversight.
Pahl, who left the FTC in 2013 to work at the CFPB, where he had been recruited to head up its debt collection rulemaking efforts, noted in a blog post that "perhaps it would be in the long-term interest of consumer protection," if the CFPB were "a bipartisan, multimember commission that is less controversial and more transparent, deliberative, and centered."
Those comments "raise serious doubts about whether he is prepared to tackle significant consumer protection issues that the FTC is obligated to do," charged Jeff Chester, executive director of the Center for Digital Democracy, a privacy advocacy group.
But such concerns are dwarfed by multiple attestations — by Democrats — of Pahl's bona fides in consumer protection, including from outgoing director Rich.
"Tom is an excellent choice as acting chief of the bureau of consumer protection," former FTC Commissioner Julie Brill wrote in an e-mail to FTC:WATCH. "He knows the FTC inside and out, and will help acting chair Ohlhausen promote the parts of the bureau that function well, and transform the parts of the bureau that are in need of improvement."
Brill, a Democrat, added, "He is well-liked by staff, companies and other stakeholders. But no one should be fooled: Tom is very smart, he knows where the bodies are buried, and he is no pushover."
David Vladeck, a former director of the Bureau of Consumer Protection in the Obama administration, also was quick to praise Pahl.
"He is an extremely smart, dedicated public servant," Vladeck said in an interview. "He was a highly valued member of the team when I was there. He understands and deeply believes in the agency's mission."
Private practitioners also see Pahl as someone who respects the agency's mission. Ronald Urbach of Davis & Gilbert noted in an interview that Pahl "has a regulatory background, he's been at the FTC in multiple roles and at the CFPB and in private practice in this space. Here is somebody who will regard the FTC with respect and understands its function and role and [will approach it] more like tailoring the edges."
To that point, Pahl said it is important always to keep "regulatory humility" foremost in mind because, "there is only so much that we can see and so much that we can anticipate, and so there is a real reason why we should be extremely careful in regulating and putting out standards."
He also sees a bigger role for economists. "Chairman Ohlhausen has emphasized in a lot of her writings — a lot of her dissents and concurrences in cases, and speeches, and the like — the importance of empirical analysis, which at the FTC usually translates into economic analysis."
But when pressed on tensions that sometimes surface between lawyers trying to build cases and economists weighing costs and benefits, Pahl acknowledged that "it may be a little awkward and a little strained, if you have two different parts of the agency who are disagreeing about something."
However, he said, "from the point of view of commissioners, that is really what you want to hear. You want people's well-informed, unvarnished views of what they think about the matter, what they think about the policy. That is actually healthy for the institution. It's not always a lot of fun, but I think it is a way of getting to better results."
If he butts heads with the number crunchers, one way that Pahl might blow off steam is on the ice. He's played hockey since he was a kid and resumed play about a year and a half ago at his brother's urging — after not having played for over 30 years.
"I don't have a great slap shot," he said, "but if you need someone to slash or check, I am really good at all the activities that lead you into the sin bin."