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Elizabeth Warren’s heroic Senate demagoguery

Elizabeth Warren’s heroic Senate demagoguery

In her debut on the Senate Banking Committee, Elizabeth Warren once again became the hero of the left because she embarrassed Hapless Bank Regulators, as the Huffington Post put it:

Bank regulators got a sense Thursday of how their lives will be slightly different now that Elizabeth Warren sits on a Senate committee overseeing their agencies.

At her first Banking, Housing and Urban Affairs Committee hearing, Warren questioned top regulators from the alphabet soup that is the nation’s financial regulatory structure: the FDIC, SEC, OCC, CFPB, CFTC, Fed and Treasury.

The Democratic senator from Massachusetts had a straightforward question for them: When was the last time you took a Wall Street bank to trial? It was a harder question than it seemed.

Well, of course it’s a harder question than it seems, because it’s an irrelevant question.

The issue is whether regulators achieve regulatory goals, not whether there is a show trial.  Lost in the hurrahs for Warren was the reasonableness of the regulators’ answers (via HuffPo):

“We do not have to bring people to trial,” Thomas Curry, head of the Office of the Comptroller of the Currency, assured Warren, declaring that his agency had secured a large number of “consent orders,” or settlements.

“I appreciate that you say you don’t have to bring them to trial. My question is, when did you bring them to trial?” she responded.

“We have not had to do it as a practical matter to achieve our supervisory goals,” Curry offered.

Think about what Warren was demanding, that a bank under the supervision of the Comptroller of the Currency be brought to trial even if the bank consented to all the relief demanded by regulators.

To what purpose?  To destabilize the banking system by causing doubts as to whether the financial institution at issue would survive a trial?

Warren then moved on to the Securities and Exchange Commission witness (via HuffPo):

Warren turned to Elisse Walter, chair of the Securities and Exchange Commission, who said that the agency weighs how much it can extract from a bank without taking it to court against the cost of going to trial.

“I appreciate that. That’s what everybody does,” said Warren, a former Harvard law professor. “Can you identify the last time when you took the Wall Street banks to trial?”

“I will have to get back to you with specific information,” Walter said as the audience tittered.

Walter then pointed out that the SEC does heavily litigate.  And so it does, as a simple check by Warren of the SEC’s website would show.   The SEC does take cases to trial (and sometimes loses).

But again, what would be the purpose of taking to trial an investment bank or brokerage firm as an entity which already consented to relief the government deemed sufficient to achieve the regulatory purpose?

When it comes to criminal charges, there is a reason the government focuses on individuals rather than entities.  The mere bringing of criminal charges against an entity often is enough to put the entity out of business.  Are our regulators there to strengthen the system, or obtain a headline which ends up damaging the system?

Elizabeth Warren understands all this.  Whatever she is, she’s no dummy.

But she saw an opportunity to score a cheap demagogic point by asking an irrelevant question to witnesses who did not anticipate the question because the question is of importance only to politicians seeking headlines, not to people truly interested in financial reform and enforcement.

The second point made by Warren, that shares in banks trade at less than book value, equally was meaningless.  There are many companies in a variety of industries which trade below book value for a variety of reasons, some of which are fundamental and some of which simply reflect investor sentiment.

Warren suggested that there was a lack credibility as to the books of the banking industry and a lack of transparency.  The answer by Law Professor and Federal Reserve Board member Daniel Tarullo respectfully put Warren in her place, although few paid attention to it.  Tarullo pointed out that the regulatory and business climates led investors to question the return on equity for banks.  Demagoguery by people like Warren contributes to this regulatory uncertainty.

(added) Politico quoted a banker who echoed Tarullo’s points:

One top exec emailed: “While Senator Warren had every right to ask pointed questions at today’s Senate Banking Committee hearing, her claim that ‘nobody believes’ that bank books are honest is just plain wrong. As Federal Reserve Governor Tarullo explained in response to her question, the low valuations are more likely due to continued economic uncertainty and concerns on the part of investors regarding the impact on banks’ profitability due to the hundreds of new regulations, higher levels of required capital, and significant activity restrictions.

“It is for these very important reasons that the financial services industry has urged regulators to get implementation right — that is, to carry out the instructions and intentions of Congress in a manner that produces a safe and sound, competitive and innovative industry. That’s what today’s hearing was supposed to be about — not some shameless grandstanding. Perhaps someone ought to remind the Senator that the campaign is over and she should act accordingly if she wants to be taken seriously.”

On both of Warren’s points, the lack of trials and banks trading below book value, Warren was doing nothing more than seeking headlines and cheers from low information supporters on the left.  She achieved that result, but did nothing to advance any insights into regulatory challenges.

Elizabeth Warren has a unique talent for marrying victimhood with demagoguery.  Which is why she should not be discounted as a 2016 Democratic presidential candidate.

That is why we will continue to build upon, and to hold Warren accountable for her own lack of transparency and her unwillingness to apologize for her own historical transgressions.


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If you really want a laugh there’s this:

Matt Taibbi Tweets Elizabeth Warren Will Be President Some Day

Our first Native-American C-I-C:)

    Yeah they laughed at people who were saying the same thing after Obama’s speech at the DNC in 2004. President Warren… Has a nice ring I think.

If the answer was that no crimes were committed, then that would be one thing…

    jdkchem in reply to Zachriel. | February 16, 2013 at 11:38 am

    Are you seriously defending asking the same stupid question repeatedly?

    The “womyn” is an idiot and a liar. Barefoot and pregnant should have been what she aspired to with affirmative action.

    Anyone who voted for or supported that moron should be banned for life from ever commenting on the intelligence of others. Period.

Note that the regulators the showboating Warren was questioning are Obama appointees.


    That’s a good point. It’s important that the legislature hold the executive to account.

      Ragspierre in reply to Zachriel. | February 16, 2013 at 1:12 pm

      Yeah. Let us know when that starts.

      Warren was not “holding to account”. She was doing a trained seal act for the Occupy crowd.

      Otherwise, instead of her “trial” red-herring, she would have asked the more revealing question, “Can you tell us what enforcement actions your agency has taken in the last four years”.

      But you knew that…

Excuse me while I take a shower after perusing the HuffPo comments to this article:)

    TrooperJohnSmith in reply to ClinkinKy. | February 16, 2013 at 10:58 am

    HuffPost, Kos, etc. are best perused while wearing rose-colored glasses with your in-line bullshit filter adjusted to MAX.

Warren was playing to the OccupyWhatever mentality…people for whom a nice Big Brother show trial, closely followed by a public spiking, would be just the ticket on a weekend.

Interesting that she was running the risk of pissing off and slimeing Obamic regulators… Or perhaps not.

TrooperJohnSmith | February 16, 2013 at 10:56 am

Liawatha is positioning herself to validate the typical Low Information (i.e. ‘Obama’) Voter’s belief that, “All those people at ‘The Banks’ and on Wall Street are crooks”.

In my conspiratorial brain, she’s already comparing her ‘populist’ leanings with Hitlery’s.

Look out America!

    But watch…

    I would bet they are lining up at this hour to start the process of funding her ambitions, JUST like they have Pres. Sleeper. This is a sort of game, and the really corrupt know they have the least to fear…and the most to gain…from those who have demonized them the most.

    See Corzine, John.

We need to recognize that “the campaign” is never over for the left. To their credit, they have had an agenda for decades to bring down America, and they have stuck to it. They have been so emboldened by their recent successes that they have brought their endless campaign out into the open. Meanwhile, most on our side sit around and ask: “Gee, don’t they know that the campaign is over?” A couple, like Ted Cruz and Rand Paul, speak out differently. They need an army to support them.

Another show pony in the land of the “Worlds Most Deliberative Body” – of demagogues.

Video: Dr Ben Carson on Sean Hannity Show – Saving America Special…

    Henry Hawkins in reply to SteveT. | February 16, 2013 at 3:20 pm

    I watched Carson on Hannity (TV) last night and was mightily impressed, which immediately made me wonder, “ok, what am I missing?” I SO hope this guy is for real and that we don’t see video of him sexually abusing underage Dominican goats in the near future.

    Carson has a manner of speaking very simply and plainly that conveys the gist like a hammer. Great Reagan level communicator.

    He described himself as an independent. What that might mean on other issues besides health care and the deficit, I dunno, but I don’t care if he turns out to be genuine and sans oppo research skeletons. He said he has no such skeletons. If so, the lefties will be designing a innuendo-based smear campaign as we speak. If they thought Palin was dangerous to their cause, they’ll be after this guy big time.

    Coincidentally, he and I grew up with blocks of one another in Detroit MI.

Insufficiently Sensitive | February 16, 2013 at 11:50 am

Unfortunately for the nation, the combination of Warren plus MSM is strikingly similar to the combination that won the 2008 presidential election by dint of an unexamined, far-left candidate.

OK I understand the drill. Freshman Senator Warren is heroic and outspoken but freshman Senator Cruz is nasty and engages in McCarthyism.

1. How about this?—

Senator, when necessary our agency undertakes litigation to fulfill its mandate from Congress and the President. Among the very many cases which are incipient, ongoing, or complete, I do not recall the particulars of every single one. Had your staff contacted us before this hearing, I would have arrived with an answer to your question.

2. HH notes that Warren was grilling Obama appointees.

Exactly. She represents those on the Left who think Obama is too doggone moderate.

Recall also that Obama did not appoint her to head the agency she established. Warren does not strike me as someone who lets bygones be bygones.

Her interest is selective. If it was comprehensive, she would also be concerned about Obama’s litigating, legislative, and executive activities, before and during his time in public office; congressional intervention which defended exploiting leverage to achieve instant (or immediate) gratification and ensured the recession of 2008 (among others); and both public and private activism which sponsored and defended corruption.

I wonder what she thinks about running trillion dollar account deficits. Surely she must understand that the diluting effects of artificially multiplying negotiable currency is effectively devaluing both capital and labor.

Anyway, her interests are selective, which leads me to believe that she possesses ulterior motives. Perhaps to provide cover for her own history of unethical, immoral, and illegal activities.

I wonder if this is merely a staged event for marketing purposes.

Sometimes I wonder what this country would look like in 20 years if the Republicans just said, “screw it, do it your way” and just quit and left the Elizabeth Warrens in charge (maybe they have already).

Would we end up looking more like Sweden, North Korea or South Africa or the Soviet Union circa 1963?

The media’s fawning over Warren reminds me of the girl sitting next to Harrison Ford in his car in “American Graffiti,” chewing gum and proclaiming, “Ain’t he neat!!”

The questioning is just inanity masquerading as profundity.

The inquiry is useless and produces no relevant information.

What I want to know is when was the last time Warren attended a pow-wow of the Cherokee nations? And why does she no longer identify herself as a Native American? Is she ashamed of her heritage?

Did Lizzy mention her 2 years as part of the Cleveland Indians organization. This woman, my Senator, is DREADFUL. 6 more years of this? ARGH!

The whole theng was a pro-forma staged political kabuki theater event. Warren is given a scripted question to answer, knowing that, as the Prof says, there can be no answer. Warren gets to lean back, smile a smug superior smile, wave a dismissing hand at the pathetic panel, and bask in the adulation of the media who see her as a fierce warrior for “the people”.

Did she really expect to hear that all the major Wall Street bannks – who gave millions to Obama’s campaign – were being brought to trial? Not likely.

Note that after the hearings Warren refused to talk to any media – just like during her campaign she almost never gave solo interviews. Like Obama, without a script/teleprompter, there’s not much there.