It’s on: Elizabeth Warren versus Wall Street

December 12, 2012

Andrew Harrer

Republicans have long derided Elizabeth Warren for describing herself as an intellectual godmother of Occupy Wall Street. Now the intellectual godmother of Occupy Wall Street will occupy the Senate committee that oversees it.

The Senate Democratic leadership is announcing today that Warren will be given a seat on the Senate Banking Committee. As Forbes put it recently, Warren’s ascent to the Senate alone was “Wall Street’s worst nightmare.” This could make that nightmare a good deal worse.

Warren’s appointment to the Banking Committee was expected; Ryan Grim broke the news some time ago. But today’s announcement will make it official.

This is going to give Warren a choice perch from which to continue to press the crusade for Wall Street oversight and accountability. And it continues a battle between her and Wall Street that stretches back literally years.  Warren, a consumer advocate and expert in bankruptcy law, angered Wall Street when she pressed state attorneys general to demand a huge settlement from major banks and financial institutions they were investigating for improper foreclosure procedures. Warren was also the inspiration behind the Consumer Financial Protection Bureau, which produced one of the ironies of her career.

The big banks won a victory when Obama declined to appoint Warren to head the Bureau. But as a result, she ran for the Senate. Wall Street made a big bet on defeating her candidacy, investing huge money in opponent Scott Brown, explicitly because of Warren’s longtime advocacy for tighter Wall Street regulation and oversight. They lost. She won.

And now Warren sits on the committee responsible for such regulation and oversight. As one hedge fund manager recently lamented: “At exactly the time that big banks don’t want more oversight — or another potentially activist regulator — that’s what they’re getting,” Or, as Andy Kroll recently put it: “Big banks versus Elizabeth Warren: It’s on (again).”

Warren’s appointment to the committee is likely to anger some top Republican Senators who hate her relentless push for more oversight and have crusaded against her consumer protection bureau as an example of oppressive liberal governance. Indeed, some Republican Senators even joined Wall Street in lobbying against her appointment to head that bureau. Now she sits among them, and is likely to get into spirited fights with them over future battles involving Wall Street regulation. Indeed, some progressives see her as a good counterbalance to Dems on the committee who might be overly solicitous towards Wall Street, too.

It remains to be seen what issues Warren will champion on the committee and what kind of influence she will be able to wield. A lot will depend on the larger tack Dems take in the next Senate. But if Warren’s candidacy served as a test of the political viability of a genuinely populist critique of Wall Street and a demand for real accountability and oversight, we will now see what her brand of populism looks like from a position of some influence inside the Senate itself.

Greg Sargent writes The Plum Line blog, a reported opinion blog with a liberal slant -- what you might call “opinionated reporting” from the left.
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Greg Sargent | December 12, 2012