Elizabeth Warren, Harvard law professor and long time champion of middle class Americans, is on the short list to be head of the new Consumer Financial Protection Bureau now that financial reform has passed.
Her name is not the only one being considered, but it is the one most talked about. Michael Barr, a Treasury official, and Gene Kimmelman, the Justice Departmentâ€™s chief counsel for competition policy and intergovernmental relations, and formerly a vice president at the Consumerâ€™s Union are also being considered. (Ezra Klein â€“ Washington Post)
Warren, however, hatched the idea of a consumer protection agency. She has not been shy about touting the validity of such an agency appearing regularly on both radio and T.V. talk shows including Jon Stewart, Charlie Rose, PBS and Bill Maher. In her pragmatic and direct style, honed on the plains of Oklahoma where she grew up, she continually champions the rights of the middle class.
While teaching law in Houston in 1978, Warren decided to investigate the newly passed, revamped bankruptcy code, which made it easier for businesses and individuals to start anew. She expected to find the bankruptcy system clogged with sleazy debtors. Instead, Warren found that most bankruptcies resulted in job loss or illness at home, a situation made worse by banks that were increasingly learning to trap people in costly debt cycles. The weapon of choice for banks? Confusion.
â€œFor Bank of Americaâ€™s credit card in 1980, the agreement was 700 words long,â€ Warren said. â€œThe average credit-card agreement by the mid-2000s was 30 pages long, and it was loaded with â€˜double-cycle billingâ€™ and â€˜LIBOR-linkedâ€™ terms no one understood.â€
The effect, Warren concluded was predation, not just for those with bad credit, but also for the entire middle class, which she felt was being hollowed out by agreements that many didnâ€™t understand. (Time)
Warren had found her calling. She appeared on Dr. Phil, giving advice to families, met with bank executives, and with her daughter wrote the book â€œThe Two-Income Trapâ€.
Shortly after Lehman Brothers collapsed in 2008 Harry Reid, Senate Majority Leader, tapped Warren to head the newly formed TARP oversight board.
It is while in this position Warren has often butted heads with Treasury Secretary Tim Geithner, who is lobbying hard for her to NOT be appointed as head of the new consumer agency.
Why? Because Elizabeth Warren has been and continues to hold Geithnerâ€™s feet to the fire with her TARP oversight duties, and her direct style is not always appreciated. She often demands monthly reports from Treasury, along with better investment returns from banks and greater efforts to help borrowers.
In early 2009 Warren was talking to someone on Capitol Hill (she wonâ€™t say whom) who told her â€œThatâ€™s not what a report is supposed to look like.â€ When she asked, â€œWhy not?â€ The reply was, â€œThe language is far too direct.â€ (Time)
Far too direct? Elizabeth Warrenâ€™s directness is what makes her so appealing. She doesnâ€™t hide behind pages of pointless rhetoric, but gets right to the point.
You also have to know she is doing something right to protect consumers when the U.S Chamber of Commerce declares war against her. After President Obama expressed interest in Warrenâ€™s idea of an agency to protect consumers from tricky financial products the Chamber immediately announced they would spend, â€œwhatever it takesâ€ to defeat the proposal.
A definite battle has been shaping up around Elizabeth Warren on the Hill, and both sides are showing strong emotion in their support for and against her. Geithner has made no bones about his dislike of Warren, along with Senators Judd Gregg (R-N.H.) and Bob Corker (R-Tenn.) who also oppose her taking the post. Jason Linkins of the Huffington Post reports that the National Journal says this about Warren:
â€œIndustry privately grumbles that Warren would be their least favorite candidate to head the agency.â€
Linkins continues, â€œSo, basically, hereâ€™s the out-front opposition to Warren: the entire financial industry, Republican lawmakers and the worse deliberative body in the history of Western civilization. That, to me, seems like the best of all possible enemy-collections.â€
To me, it seems like the best of all reasons to support her. We â€“meaning the middle class- so badly need a strong advocate on our side who is not afraid to stand up to the likes of Geithner, The Chamber, Republicans and Wall Street.
She does have a growing list of supporters, however. House Financial Services Chairman Barney Frank (D-Mass), one of the key authors of the reform bill, formally signed a letter being circulated among House Democrats vouching for Warrenâ€™s qualifications for the post.
Rep. Carolyn Maloney (D-N.Y.) author of the letter, now signed by a least a dozen House members, released this statement explaining her support.
â€œBig banks and financial service companies spent the last decade telling us they could police themselves and what we got was the largest economic crisis since the Great Depression. The President must nominate Elizabeth Warren to the CFPB because we need aggressive regulators who are committed to protecting consumers from Wall Street excess.â€ (Huffington Post)
Elizabeth Warren: Author of the Consumer Protection Plan, strong advocate for middle class Americans, despised by financial intuitions, Republicans and big business. She sounds like an excellent candidate as the head of Consumer Financial Protection Bureau.
Cheri Cabot, Politics Correspondent
Cheriâ€™s column, â€œPersonal About Politics,â€ published every week, will reflect on how the life of a 60 year-old, middle class woman is affected by politics, policy and the current state of the nation - a look at the personal aspects of politics. Her column is part of Gather Essentials.
Cheri is a freelance writer, living in Southern California.Â She has two grown children and is the proud grandmother of three.
You can find all of Cheriâ€™s columns on Personal About Politics at www.personalpolitics.gather.com, The Obama Watch at theobamawatch.gather.comor her home page here, www.ccabot.gather.com.