Sen. Elizabeth Warren (D-Mass.) and the Democrats’ populist anti-Wall Street faction took a stand that will reverberate through politics over the next year. (J. Scott Applewhite/AP)
Congressional Democrats took a stand Thursday that ultimately failed but that will nevertheless reverberate next year both inside the Capitol and on the presidential campaign trail.
The populist anti-Wall Street faction, increasingly embodied by freshman Sen. Elizabeth Warren (D-Mass.), nearly took down a bill to fund the federal government in a revolt over a provision that would ease restrictions on risky trades by big banks.
For the Warren wing, what they see as siding with banks over average Americans is among the most unforgivable of sins, and the showdown exposed just how disruptive and demanding this populist bloc plans to be.
“A vote for this bill is a vote for future taxpayer bailouts of Wall Street,” Warren said in a 10-minute speech Thursday blasting the bill. “When the next bailout comes, a lot of people will look back to this vote to see who was responsible.”
On the other side of the new Democratic divide are a number of longtime power brokers on the Hill, including Sen. Majority Leader Harry M. Reid (Nev.) and House Minority Whip Steny H. Hoyer (Md.), who have held key positions in Washington since at least the Clinton administration. Operating in what they viewed as a pragmatic manner, they hoped to leverage the best deal possible in their final days with a Senate majority.
They saw the more than $1 trillion deal as a bipartisan compromise — a term that has gone out of fashion in Washington — necessary to fund the government and preserve money for key liberal programs. They prodded President Obama and his top advisers into waging a last-ditch lobbying effort to save the deal. And they argued that the alternative, letting an all-Republican Congress write new spending bills next year, would be far worse than this bipartisan package.
“I think the progressives within the Senate Democratic caucus are feeling they have to speak up,” said Sen. Richard J. Durbin (D-Ill.), a 32-year veteran of Congress. “Most of those who are vocal and active have never been in the minority. I listen to them and I think, ‘They’re not aware that this place is going to change a lot in just a few weeks.’ ”
Yet, in a sign of the growing clout of the Warren faction, Durbin declined to say in advance how he would vote on the 1,600-page legislation if the House was able to approve it, a surprising neutral position for a longtime member of the Appropriations Committee that co-wrote the plan.
With the House’s narrow approval of the bill, the fight now heads to Warren’s home turf in the Senate, where she will have a day or two to rally support against it. Her challenge will be steep, with a large bloc of Democrats and Republicans poised to support the legislation. It’s unclear whether Warren would support a filibuster.
The rift among the Democrats, which has grown wider since the party got beaten badly on Election Day, has left Obama and his would-be allies on the Hill increasingly pointing fingers at one another: Senate Democrats blame Obama for costing them their majority; White House officials blame them right back; and when the two sides agree, the populists in the Senate and House step in and try to blow it all up.
They were successful late last month, when Reid was on the verge of a substantial pact with House Republicans to make permanent a crop of tax breaks. Just before Thanksgiving, Sen. Ron Wyden (D-Ore.), the chairman of the Finance Committee, broke up that deal with support from the White House and House Democrats who thought it gave away too much to corporate America.
The result is the likely passage of legislation that merely kicks the can down the road, approving almost all of those breaks just for 2014 but leaving the issue to be debated again next year under the Republican-led House and Senate.
The can-do desires of establishment Democrats have been increasingly drowned out by liberals like Warren, who have energized activists across America and are beginning to pull other Democrats further to the left.
That’s a dynamic that will likely play out in the Democratic presidential primaries. To many in the party, likely front-runner Hillary Rodham Clinton is too cozy with Wall Street and out of step with the grass roots. She’s likely to be challenged on that front by a handful of rivals, including Sen. Bernard Sanders of Vermont, an independent who caucuses with Democrats; former U.S. senator Jim Webb of Virginia; and Maryland Gov. Martin O’Malley.
None are considered serious threats at this point, but all could force Clinton into difficult conversations or to take liberal positions that could hurt her in a potential general election contest.
The wild card in the 2016 race is, increasingly, Warren. She has repeatedly denied interest in a White House bid, but liberal supporters and groups are trying hard to push her into the race. Members of MoveOn.org, for instance, voted this week to support a $1 million effort to get the Massachusetts senator to run.
Warren showed this week that she already holds significant sway within her party on Capitol Hill. Many Democrats who supported the funding plan privately questioned whether House Minority Leader Nancy Pelosi (D-Calif.) had been pulled to the left by Warren’s increasing opposition to the bill. Pelosi went from a muted view of the legislation at the start of the week, to opposing it but encouraging other members to vote their conscience, to then accusing Obama and Democrats of giving in to “blackmail” by allowing the Wall Street provision in the legislation.
“I’m enormously disappointed that the White House feels that the only way they can get a bill is to go along with this,” Pelosi said Thursday in a scathing floor speech about 30 minutes before the vote was expected.
By then, so much Democratic opposition had built that House Speaker John A. Boehner (R-Ohio) hit the pause button on the debate, and over the next seven hours Obama, Vice President Biden and senior administration officials made the case to wavering Democrats to support the plan.
Obama even dispatched his chief of staff, Denis McDonough, to meet in a basement room inside the Capitol Visitors Center with the nearly 200 House Democrats.
While his visit may have moved some House Democrats to support the bill, many others exited the more than three-hour meeting angrier than ever. According to a Democrat who was there, at one point rank-and-file lawmakers tried to demand that all White House staff except McDonough be ejected from the room.
After McDonough left, Pelosi explained her own opposition and gave a final plea that, even if enough Democrats supported the bill to get its approval, the fight would go on, according to the notes of a Democrat in the room. “I’m giving you the leverage to do whatever you have to do. We have enough votes to show them never to do this again,” she said.