Warren Uses Star Power to Push Tough-on-Wall-Street Agenda

WASHINGTON, DC - JULY 11: U.S. Sen. Elizabeth Warren (D-MA) questions witnesses during a Senate Banking, Housing and Urban Affairs Committee hearing on 'Mitigating Systemic Risk Through Wall Street Reforms,' on Capitol Hill, July 11, 2013 in Washington, DC. The committee heard from the panel about the progress being made on reform provisions that improve financial stability. (Photo by Drew Angerer/Getty Images)
National Journal
Stacy Kaper
Oct. 6, 2013, 7:33 a.m.

Sen. Eliza­beth War­ren giggles like a girl sought after by the coolest boy in school when asked what she makes of the pro­gress­ive push for her to “save” lib­er­als from a feared “too-close-to-Wall-Street” pres­id­en­tial run by Hil­lary Rod­ham Clin­ton in 2016.

But the “Aw shucks, me?” ven­eer shines with the pol­ish of a prac­ticed politi­cian. War­ren is im­min­ently aware of the spot­light she’s un­der and fully cog­niz­ant of the fact that the mes­sage she sends will be as thor­oughly dis­sec­ted as the Fed chair­man talk­ing about the eco­nomy.

“My job is here in the Sen­ate,” the Mas­sachu­setts Demo­crat said in an in­ter­view, wav­ing off the ques­tion, rooted to a chair in her Cap­it­ol Hill of­fice with tower­ing ceil­ings.

“I have been fight­ing for middle-class fam­il­ies for dec­ades and I have a chance here to make a dif­fer­ence and that’s what I’m try­ing to do. And that’s what I’m fo­cused on. That’s it,” she said, adding firmly, “If you need a ‘no,’ you’ve got the ‘no.’ “

In an en­vir­on­ment where little le­gis­la­tion is mov­ing on Cap­it­ol Hill, par­tic­u­larly in the fin­an­cial-ser­vices/con­sumer-pro­tec­tion arena where she made her name, War­ren is em­ploy­ing her celebrity stature and her Har­vard Law as­siduity to her be­ne­fit.

She set the tone early this year when she fam­ously blas­ted reg­u­lat­ors for treat­ing too-big-to-fail in­sti­tu­tions as “too big for tri­al” in her de­but hear­ing at the Sen­ate Bank­ing Com­mit­tee. The ex­change be­came her first of many You­Tube hits, draw­ing more than a mil­lion view­ers in less than a week and sim­ul­tan­eously hand­ing pro­gress­ive groups a jack­pot clip to build a cam­paign war chest.

War­ren is among the least seni­or mem­bers of the Bank­ing Com­mit­tee, but her words un­ques­tion­ably draw the most at­ten­tion, so she takes ad­vant­age of that by stick­ing to pet is­sues that res­on­ate well with voters and fo­cus­ing like a laser beam where she sees an op­por­tun­ity to nudge the de­bate.

“This is about us­ing the tools to be ef­fect­ive,” she said. “There are many tools in the tool­box and I want to use every one of them to help level the play­ing field for work­ing fam­il­ies.”

Al­though crit­ics on the left and right privately lament that her rabble-rous­ing per­form­ance in hear­ings ap­pears to be as much about steer­ing out­comes as it is about im­mor­tal­iz­ing her firebrand repu­ta­tion, aides on both sides of the aisle ac­know­ledge she ap­pears at least as much work­horse as show horse. She might get her five minutes of fame in sound bites at hear­ings, but she has the best at­tend­ance re­cord of any of the mem­bers, in­clud­ing the chair­man and rank­ing mem­ber, and routinely stays to the bit­ter end, long after the cam­er­as have stopped rolling.

War­ren also has the dis­tinc­tion of be­ing a rare fresh­man who is the seni­or sen­at­or from her state. She knocked off in­cum­bent Sen. Scott Brown, R-Mass., in Novem­ber and then, when former Sen. John Kerry, D-Mass., resigned to be­come sec­ret­ary of State in Feb­ru­ary, War­ren jumped from ju­ni­or to seni­or after less than a month in the Sen­ate.

As the brainchild be­hind the cre­ation of the Con­sumer Fin­an­cial Pro­tec­tion Agency, a former lead­er of the Con­gres­sion­al Over­sight Pan­el formed in the wake of the con­tro­ver­sial $700 bil­lion fin­an­cial-in­dustry bail­out known as TARP, and a former bank­ruptcy-law pro­fess­or, she is clearly well-seasoned in fin­an­cial policy.

War­ren might not have any ob­vi­ous single-handed suc­cesses to point to since she took of­fice in Janu­ary, but she has kept steady pres­sure on the left not to go soft on rein­ing in Wall Street and has sought to hold those in power ac­count­able.

Her ef­forts are cred­ited with help­ing bring down the White House’s pur­suit of Lawrence Sum­mers for Fed­er­al Re­serve Board chair­man and ce­ment­ing Richard Cordray’s con­firm­a­tion as dir­ect­or of the Con­sumer Fin­an­cial Pro­tec­tion Bur­eau without let­ting Re­pub­lic­ans weak­en the agency’s power.

“I pushed hard on this,” she said of the CFPB, “be­cause it really mat­ters to me and I’m glad a lot of people got in­volved.”

She was a vo­cal ad­voc­ate for keep­ing stu­dent-loan in­terest rates low. She offered a bill that would tie such rates to the rates banks re­ceive when bor­row­ing from the Fed. The bill ap­peared in­ten­ded to pick a fight about why big banks re­ceive spe­cial gov­ern­ment treat­ment.

Most not­ably, however, War­ren is viewed as light­ing a fire un­der reg­u­lat­ors to de­mand meat­i­er set­tle­ments with the fin­an­cial in­dustry. She points with pride to the Se­cur­it­ies and Ex­change Com­mis­sion’s an­nounce­ment in June that it would re­quire in­sti­tu­tions to ad­mit wrong­do­ing in cer­tain set­tle­ments.

“Reg­u­lat­ors have a lot of dis­cre­tion “¦ and it’s sort of al­ways push­ing in the same way, al­ways push­ing to see the rules weak­en.”¦ It’s ne­ces­sary to make sure there is push­back against that and that’s part of what I want to do from the Bank­ing Com­mit­tee,” War­ren said.

“Those set­tle­ments only work if they are backed up by a cred­ible threat that the gov­ern­ment is will­ing and able to go to tri­al and that’s what this has done and we have seen the needle move this way.”

For now, War­ren’s voice might be her migh­ti­est tool.

“I try to talk about the things where it is pos­sible to make a dif­fer­ence. That’s what I’m fo­cused on,” she said.

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