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Elizabeth Warren, the CFPB architect and frequent bank critic, was elected late Tuesday to the Senate, much to the dismay of the financial services industry.
November 6 -
Liberal blog Daily Kos has collected more than 63,000 signatures for an online petition asking Senate leadership to put Elizabeth Warren on the banking committee.
November 14
WASHINGTON — Senator-elect Elizabeth Warren has secured a spot on the Senate Banking Committee and she'll be joined by Sen. Joe Manchin, according to a Democratic Senate aide.
Warren, a Harvard professor and founder of the Consumer Financial Protection Bureau,
Critics have warned that the Massachusetts Democrat could have outsized influence on the committee given her strong and often critical views of the industry, but many observers have said that it would be difficult for Senate leaders to deny her a spot given her background. Several liberal groups had started a
The Senate aide cautioned that the decisions about Warren and Manchin will not be final until Majority Leader Harry Reid makes a public announcement.
But observers were already assessing what kind of impact Warren may have.
"I don't think she's going to take the slow road. Once she's there she's going to hit the ground running," said Isaac Boltansky, a policy analyst at Compass Point Research & Trading.
"The most compelling forum to see her in action may be confirmation hearings for the next Treasury Secretary," Boltansky said, pointing to her work on a congressional oversight panel for the Troubled Asset Relief Program and occasional standoffs with Treasury Secretary Timothy Geithner in that role. "There were
Others argue that toning down criticism of the banking industry could ultimately help Warren be more effective on the committee.
"She made her mark thus far by speaking very harshly about bankers for their past sins in a very adversarial and proudly adversarial way," said Cornelius Hurley, director of the Boston University Center for Finance, Law & Policy. "I think if she brings that same backward-looking approach to her legislative responsibilities, that will be a problem, as opposed to being more forward looking in helping to craft some solutions to the problems that are still on the table from housing reform to capital requirements to 'too big to fail.'"
But Hurley added that bankers must also be willing to set aside their past frustrations with Warren.
"I think the bankers may be guilty of conjuring up in their own minds a more ghoulish person than she really is," he said.
Some industry groups already appear to be trying to reconcile with Warren.
"We will be reaching out to her and meeting with the senator-elect as soon as possible. I think there is going to be a tendency to try to paint her in a Dodd-Frank box, and while we will certainly want to engage her in that conversation, the banking industry has a much broader agenda that we want to speak with her about ," said James Ballentine, executive vice president of congressional relations and political affairs at the American Bankers Association.
Separately, Manchin is also expected to be named to the banking panel next term, according to the Senate aide.
The West Virginia Democrat and former governor has not typically played a big role in financial issues to date in the Senate, though observers said he maintains a good relationship with the industry.
"We've worked very well with Sen. Manchin since he's been in Congress," said Ballentine. "He's got a close relationship with bankers in his state."
Boltansky said that in other arenas, Manchin is known as a "consensus builder" and as someone who's able to work across party lines. He currently sits on the Energy and Natural Resources Committee, the Armed Services Committee and a Special Committee on Aging.
"That joviality is going to be necessary as the committee starts working on a Dodd-Frank technical corrections bill," he said. "With folks like Manchin joining and Mike Crapo taking a leadership role, the panel has the ability to hit a reset button and pass compromise legislation next year."
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