Tag Archives: United States Consumer Financial Protection Bureau

Incoming! Elizabeth Warren lands post on Senate Banking Committee

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The Huffington Post has more:

Nearly two years after Wall Street waged a successful campaign to keep consumer advocate Elizabeth Warren from running the Consumer Financial Protection Bureau, the incoming senator will be tapped to serve on the Banking Committee, according to four sources familiar with the situation. It’s a victory for progressives who battled to win her a seat on the panel that oversees the implementation of Dodd-Frank and other banking regulations.

Warren knocked out Republican Sen. Scott Brown of Massachusetts in the most expensive Senate contest of 2012, with Wall Street spending heavily to beat Warren, a former Harvard law professor.

Sources also told HuffPost that Sen. Joe Manchin (D-W.Va.) will be named to the panel.

Warren’s ascension to the panel gives her influence over regulators and the industry that non-panel members don’t enjoy.

As Daily Intel’s Kevin Roose notes, Warren is likelier to take her time building a network of ideological kin than to take a one-woman stab at the financial establishment right off the bat:

After my piece on Wall Street’s worries about Warren ran last week, I got a call from a senior banking industry lobbyist, who contended that Warren herself wasn’t planning to come into the Senate and immediately begin pushing an anti-bank agenda. Her more likely tactic, he said, would be to slow-play the situation, quietly amassing power and influence among fellow senators at first and then going after the banks once a coalition had been established.

“She realizes that if she appears to be a caricature of herself, she won’t be super-relevant in the Senate,” the lobbyist said.

Whatever her strategy, this is good news for progressive observers, who worried that Senate Democrats — always a weak and unreliable bunch — would cave under pressure from their Wall Street backers and keep Warren off the committee.

Elizabeth Warren: scaring banks since 2008

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And rightly so. These days, the fight has moved from her Senate candidacy to a battle over her possible appointment to the Senate banking committee:

Not even two weeks have passed since Democrat Elizabeth Warren rode a wave of grassroots support to victory in the US Senate race in Massachusetts, ousting Republican incumbent Scott Brown. Senator-elect Warren has not yet hired her staff. She has not yet moved into her Senate office. But the banking industry is already taking aim at her, scurrying to curb her future clout on Capitol Hill.

Lobbyists and trade groups for Wall Street and other major banking players are pressuring lawmakers to deny Warren a seat on the powerful Senate banking committee. With the impending departures of Sens. Herb Kohl (D-Wisc.) and Daniel Akaka (D-Hawaii), Democrats have two spots to fill on the committee before the 113th Congress gavels in next year. Warren has yet said whether she wants to serve on the committee. But she would be a natural: she’s a bankruptcy law expert, she served as Congress’ lead watchdog overseeing the $700 billion bank bailout from 2008 to 2010, and she conceived of and helped launch the Consumer Financial Protection Bureau (CFPB).

But the big banks are not fans of Warren, and their representatives in Washington have her in their crosshairs. Aides to two senators on the banking committee tell Mother Jones the industry has already moved to block Warren from joining the committee, which is charged with drafting legislation regulating much of the financial industry. “Downtown”—shorthand for Washington’s lobbying corridor—”has been going nuts” to keep her off the committee, another Senate aide says.

Sen. Jack Reed (D-R.I.), a banking committee member, has been angling to get Warren on the committee, “but there are many bank lobbyists pushing to keep her off,” a top Democratic Senate aide told Politico‘s Morning Money tipsheet. But the aide added, “If she really wants banking, it will be very tough politically to keep her off.”

Several banking trade groups—including the American Bankers Association, Securities Industry and Financial Markets Association, and the Mortgage Bankers Association—declined or didn’t respond to requests for comment. A spokesman for Warren also declined to comment.

The big banks’ opposition to Warren, a fierce consumer advocate, is no shocker. She supported the Dodd-Frank financial reform law, and she blasted Brown, who did vote for Dodd-Frank, for launching a “guerrilla war” to undermine its implementation. She backs the Volcker Rule, a limit on how much banks can trade with their own money. What may trouble the big banks most is Warren’s call for revisiting the Glass-Steagall Act, which separated riskier investment banks from more staid commercial banks. Reinstating Glass-Steagall would mean breaking up sprawling Wall Street institutions such as JPMorgan Chase, Citigroup, and Bank of America.

This is an important moment for the Democratic Party. Its leaders — specifically, Harry Reid, who makes the committee appointments — have a great opportunity to try to demonstrate that they are not beholden to their myriad financial interests and that they do support the sterling work done by Elizabeth Warren to protect consumers and hold financial firms accountable. If they cave on this one, as they very well might, it will be a bad omen for this next session of Congress generally on all sorts of issues.