Elizabeth Warren: From Consumer Advocate to United States Senator
No doubt Republicans are now wishing they had not opposed Elizabeth Warren’s appointment to head the Consumer Financial Protection Bureau.
Elizabeth Warren (Photo credit: qwrrty)
Warren’s victory in the Massachusetts Senate race this evening is a huge victory for consumers – and a huge loss for the banking industry, which poured millions of dollars into the coffers of the incumbent, Republican Scott Brown.
The financial services industry likes to claim that Warren is a media attention monger, and one who doesn’t have a clue what she is talking about. The truth is just the opposite. Warren knows her subject all too well and that’s why she is adored by consumers and reviled by the financial services sector.
According to the research organization Maplight, six of Brown’s top ten contributors were from the financial services sector and included such firms as Fidelity Investments, Goldman Sachs and JPMorgan Chase.
Warren has been a staunch consumer advocate since she began studying bankruptcy filings. Instead of finding the irresponsible spendthrifts she expected, the Harvard Law School professor discovered the majority of those filing for protection from their creditors in the courts were in extremis thanks to health care, employment or marital crises.
Warren went proactive. She began to publish, not in academic journals, but in the mainstream press. Again and again, she explained that Americans were not overspending, but were suffering from intractable economic headwinds. Her research revealed that items ranging from food to clothes were cheaper when calculated in constant dollars than they had been in the past. What was doing us in was the cost of other necessities – healthcare, housing, education – which were increasing at rates significantly above that of inflation (not to mention our paychecks) for decades.
All this forced increasingly desperate Americans to turn to the financial services industry to get by. As help they did – if you count as help predatory products with gotcha clauses, credit cards with usurious interest rates, and payday loans that ballooned so fast they would embarrass Tony Soprano. Then there was just the low-rent nature of the industry. Never mind shameless debt collectors. Players like Capital One would violate the law by continuing to pursue people whose debts had been discharged by the nation’s bankruptcy courts
In the wake of the financial crisis of 2008, Warren brainstormed what would become the Consumer Financial Protection Bureau as a way of protecting consumers against the predatory financial services industry and was brought to Washington D.C by President Barack Obama to bring it to life when it was voted into existence as part of the Dodd Frank legislation. But when the time came to appoint a head for the CFPB, Obama folded in the face of implacable Republican opposition, not to mention the objections of such Obama cabinet members as Treasury Secretary Timothy Geithner.
Instead of running back to academia, Warren went on to challenge Scott, who had been the surprise winner of the 2010 election to replace the late Senator Ted Kennedy, riding into office on the strength of a telegenic pick-up truck, and the support of the suddenly powerful Tea Party. Along the way, she made the case for government services, pointing out in now famous off-the cuff comments that no one makes it completely on their own efforts, but needs the help of the wider society, remarks that no doubt have greater resonance in the wake of Hurricane Sandy. “You built a factory out there?,” she said. “You moved your goods to market on the roads the rest of us paid for; you hired workers the rest of us paid to educate; you were safe in your factory because of police forces and fire forces that the rest of us paid for. You didn’t have to worry that marauding bands would come and seize everything at your factory, and hire someone to protect against this, because of the work the rest of us did.”
Now it’s likely Warren can continue her campaign for the consumer from a perch on the Senate Banking Committee.
Give ‘em hell Elizabeth.
Addendum: It would be remiss of me not to point out that Warren is also the first female Senator elected by the state of Massachusetts.
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About Helaine Olen
I am the voice of The Bills, a column about the intersection of money and life, at Slate. At Inc., I contribute to the Spread the Wealth personal finance column. My work on politics, economics, workplace culture and women’s issues has been published in numerous other print and on-line publications, including The New York Times, The Wall Street Journal, The Washington Post, The Atlantic, Salon, Pacific Standard, and The Los Angeles Times, where I wrote and edited the popular “Money Makeover” feature.
I'm the author of the critically acclaimed book Pound Foolish: Exposing the Dark Side of the Personal Finance Industry, and The Index Card: Why Personal Finance Doesn’t Have to be so Complicated, which I co-wrote with Harold Pollack.
What else? I’m a passionate bibliophile, a fan of 1970s pop music and a lover of rummage sales. I live in New York City.
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