Financial reform and Elizabeth Warren

This article continues the critique of Elizabeth Warren by starting with a speech in opposition to a provision repealing elements of financial reform passed by Congress and signed by President Obama in 2010.

Here some excerpts from Senator Warren’s speech about Citigroup, which criticizes them for their influence in Washington:

“…Today, I’m coming to the floor not to talk about Democrats or Republicans, but about a third group that also wields tremendous power in Washington: Citigroup. Mr. President, in recent years, many Wall Street institutions have exerted extraordinary influence in Washington’s corridors of power, but Citigroup has risen above the others. Its grip over economic policymaking in the executive branch is unprecedented…That’s a lot of powerful people, all from one bank. But they aren’t Citigroup’s only source of power. Over the years, the company has spent millions of dollars on lobbying Congress and funding the political campaigns of its friends in the House and the Senate. Citigroup has also spent millions trying to influence the political process in ways that are far more subtle—and hidden from public view…Citigroup has a lot of money, it spends a lot of money, and it uses that money to grow and consolidate a lot of power. And it pays off. Consider a couple facts…Washington already works really well for the billionaires and big corporations and the lawyers and lobbyists. But what about the families who lost their homes or their jobs or their retirement savings the last time Citi bet big on derivatives and lost? What about the families who are living paycheck to paycheck and saw their tax dollars go to bail Citi out just six years ago? We were sent here to fight for those families, and it’s time – it’s past time – for Washington to start working for them.”

This sentiment is no doubt correct in that Citigroup does have a lot of power in Washington. As Dick Durbin admitted years ago, “the banks…the most powerful lobby on Capitol Hill…frankly own the place.” But, Warren’s description of Citigroup is interesting, for one because her description of a “group that also wields tremendous power in Washington,” has exerted “extraordinary influence in Washington’s corridors of power,” has a “grip over economic policymaking in the executive branch,” has spent “millions of dollars on lobbying Congress and funding the political campaigns of its friends in the House and the Senate” and has “spent millions trying to influence the political process in ways that are…hidden from public view” sounds like the Israeli lobby. An article in The New Yorker earlier this year, regardless of its problematic framing of the Israeli lobby which excluded groups like J Street, framing them as “good,” describes AIPAC in a similar way as Warren described Citigroup.

It is important to remember that AIPAC does NOT have the same amount of influence as Citigroup nor is it as powerful, but this comparison is still a good one. The influence of AIPAC no doubt helped them, like Citigroup’s money, “grow and consolidate a lot of power.” Warren had her first foreign trip to Israel where she met with prime minister Benjamin Netanyahu, and she ran away “from a reporter at Netroots [in] July…when he sought to ask her about all the civilians dying,” as noted by Mondoweiss. She declared that “[W]hen Hamas puts its rocket launchers next to hospitals, next to schools, they’re using their civilian population to protect their military assets. And I believe Israel has a right, at that point, to defend itself,” which is a statement that is justified.

Some may criticize her full views on the Gaza war:

“I think the vote [for the Iron Dome] was right, and I’ll tell you why I think the vote was right. America has a very special relationship with Israel. Israel lives in a very dangerous part of the world, and a part of the world where there aren’t many liberal democracies and democracies that are controlled by the rule of law. And we very much need an ally in that part of the world…

when Hamas puts its rocket launchers next to hospitals, next to schools, they’re using their civilian population to protect their military assets. And I believe Israel has a right, at that point, to defend itself.”

A similar position is held by Bernie Sanders and Al Franken, with people coming out and criticized them for their support. Still, she is in the clear because Israel has a right to defend itself with all its might, even if that violates international law. Additionally, some could say that there has been some progress, since Elizabeth Warren and Bernie Sanders both didn’t sign an AIPAC letter which warns Palestinian delegates to not make “negative” moves in the UN, and that Gaza should be demilitarized.

It is best to reprint a section of the speech excerpted earlier in this article:

“Washington already works really well for the billionaires and big corporations and the lawyers and lobbyists. But what about the families who lost their homes or their jobs or their retirement savings the last time Citi bet big on derivatives and lost? What about the families who are living paycheck to paycheck and saw their tax dollars go to bail Citi out just six years ago? We were sent here to fight for those families, and it’s time – it’s past time – for Washington to start working for them.”

Many Americans would likely agree with these views as they are not really that controversial. But, it is important to ask: will Elizabeth Warren really help Washington work for struggling families that are homeless or have two jobs rather than “billionaires….big corporations…lawyers and lobbyists”? In my view, the answer is no, in some ways as Yves Smith put it in August 2011 and in October 2011. Her view seems to echo to some degree, if not completely, those that say, convincingly, that Barack Obama and many other Democrats are now ‘Rockefeller Republicans,’ or moderate Republicans, which has even been alluded to in a Mother Jones article in 2013 that correctly turns her investment portfolio into something positive.

Lest us not forget that Warren’s plan for the CFPB (Consumer Finance Protection Bureau), an organization originally thought of by consumer advocate Ralph Nader and then defeated thanks to pressure by the business community in the 1970s. Still, as a New Yorker article in 2011, said, the CFPB would restore confidence in the financial industry, which is a good thing when we go into Trumpian America. Her position as what some have sneered as just “a conventional Democrat” with a populist vaneer, gives her the ability to do what she needs to do for middle class and working families. She really is a “splendid radical,” a powerful voice “for progressive reform” and a person who has a “comprehensive knowledge of how Wall Street firms like Citigroup maintain their stranglehold on the levers of power in Washington.” Even if you think she is not a “credible peace candidate” there is no doubt she is a “well-spoken politician who knows what she has to do to further her career” even as she supported (rightly) economic sanctions against Iran. Those that say that “Elizabeth Warren isn’t actually that progressive” and mocking that Warren’s “tough talk sounds good to a lot of people,” don’t really understand how the Democratic Party works!

Lance Selfa is the worst, writing that politicians like de Blasio and Warren haven’t “made any noise about pursuing a “progressive agenda” outside the Democratic Party,” so they can be “relied on as loyal soldiers in the end,” meaning that they serve an important role in Democratic Party politics. Guy Miller made a similar argument. Just disgusting people who want to unfairly take down Warren! She is a person who declared that a constitutional amendment would “reverse the damage inflicted on our country” by Citizens United. She was Warren’s progressivism is questionable considering what this article has already discussed. She was right, in her speech to the Massachusetts Chamber of Commerce in October 2013 to say that

Innovation makes us soar. .And government-supported research is a critical first step in generating that innovation…Government provides patient capital, the kind that can wait for long-term results. That’s why government support for basic research is essential…there is more at stake than just economics and global competitiveness…We are running out of time. If we continue on our current path, we will soon lose a whole generation of young scientists—lose them to other countries, or lose them to science altogether…We need to reduce our deficits, and that means making smart choices on spending. Right now, our country spends billions in the wrong places…We need to align our spending with high value investments, and we need to align our spending with our values. That means investing in innovation…I intend to fight for big investments in research and innovation. I hope you will be part of this fight.”

While some may think this sounds deeply neoliberal and buys into the ideas of deficit hawks, that is dangerous as such a statement only reinforces her position as a fighter for Main Street that is working to combat the horrible influence of Wall Street. There are a number of other positions she has which are problematic. Some may say when she said that heavily redacted Senate torture report as “deeply troubling,” is absurd as it almost understates the torture practiced by the United States since 9/11, it is actually very honest. She was as honest in her article opposing the Kinder Morgan pipeline, in which she writes that “we have an obligation wherever possible to focus our investments on the clean technologies of the future — not the dirty fuels of the past — and to minimize the environmental impact of all our energy infrastructure projects. We can do better — and we should.” In the end, she is still a good politician through and through.

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