But Elizabeth Warren just released a plan for bankruptcy reform — not usually a hot-button issue on the campaign trail — that might as well come with a picture of Joe Biden with a red line through his face. It may well restart an old argument between them, and if Biden ends up becoming the Democratic nominee, it could preview a key attack Republicans will use against him.
Warren’s plan is built around a critique of the 2005 law that made bankruptcy harder to obtain, with some serious consequences for people in financial distress. At the time it was being debated, Warren was a law professor and one of the country’s most noted experts on bankruptcy; she used that position to advocate against the bill.
In so doing she ran up against the one of the best friends the banks and credit card companies had in Congress: Joe Biden of Delaware, a state that had quite purposefully used lax regulations to turn itself into a magnet for financial firms. So in her new plan, Warren would repeal much of that bill. Here’s some of what she proposes:
- Remove certain obstacles to entering bankruptcy, making it easier for people to enter the process.
- Remove some of the bureaucratic requirements imposed on people once they are in the process.
- Allow people in bankruptcy to discharge their student loans as part of the process, which they cannot now do.
- Allow people in bankruptcy to set aside more money for basic needs for themselves and their children.
- Make it easier for those in bankruptcy to keep their homes and modify their mortgages.
- Allow renters to keep paying rent while in bankruptcy.
As David Dayen notes, “The plan also unearths amendments that Biden and his colleagues voted down during the debate over the 2005 bankruptcy bill, at the behest of the industry.” The renter provision is one of them. Although Biden is never mentioned by name, there is one sly reference to “certain states like Delaware” that protect the wealthy in bankruptcy while not helping those of more modest means.
If you or someone you know hasn’t had the misfortune of falling into it, bankruptcy may not seem like a pressing issue. But this conflict is at the root of what seems from the outside to be long-simmering, genuine dislike between Biden and Warren. To simplify things, she sees him as a water-carrier for the rapacious corporations she spent years fighting, and he sees her as an uppity know-it-all who unfairly challenged his self-proclaimed status as the working man’s best friend in Washington.
And yes, it is self-proclaimed, or at least self-exaggerated. Nobody thinks Biden doesn’t sincerely care about ordinary people, but he also regularly claims that “They call me Middle Class Joe — it’s not meant as a compliment in Washington.” In fact, no one except Joe Biden has ever called Joe Biden “Middle Class Joe.”
This gets to one of the basic disagreements between Biden and Warren: Is the system in need of profound change, or not? Warren’s argument is that the banks and credit card companies have written the rules to benefit themselves at the expense of ordinary people, so you need to rewrite those rules. Biden would make more modest policy changes; for him, it’s not about changing the system, it’s about changing the guy in charge. His appeal is based on personality: I’m Middle Class Joe! From Scranton! C’mon kiddo, God love ya, you know I’ll be there for ya!
You can tell I find that argument a little ... let’s say thin. But there’s no doubt that it has a strong appeal for many voters. At the same time, it’s vulnerable to attack from President Trump.
That’s because the reg’lar guy Joe Biden and the Joe Biden who advocated for the interests of the finance companies that wield such influence in his home state always had an uneasy coexistence. And Republicans know that if Biden were the nominee and they could undermine the idea that he stands up for regular people, he’d have a very hard time winning. As Karl Rove used to say, you don’t go after your opponent’s weakness; you go after his strength.
Of course, in a better world the idea that someone like Trump, who has spent every day of his presidency screwing over regular people while doing the bidding of the wealthy and corporations, could accuse anyone else of not helping regular people would be preposterous. Kind of like him accusing his opponent of being “crooked.” This is not that world.
So it’s best for all concerned if Biden and Warren have it out on bankruptcy and everything else it represents. Maybe she’ll convince us that he can’t be trusted to do what’s right for vulnerable people, or maybe he’ll convince us that he’s just the person to serve them. Either way, it would be good to find out now.