Knives Out for Elizabeth Warren

By Ethan Brown, Section Economy
Posted on Wed Apr 22, 2009 at 09:49:00 PM EST
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Just two days ago, Yves Smith wrote of the "move to clip the wings of TARP overseer Elizabeth Warren."

Smith linked to a Politico piece piece about Warren which had some absurd anti-Warren quotes like "a number of people wonder if this is the new Warren commission or the congressional oversight panel."

Predictably, Joe Weisenthal at Clusterstock joins the anti-Warren chorus with a post titled "TARP Watchdog Elizabeth Warren Blowing Her Credibility, Overstepping Her Bounds." [More...]

Weisenthal doesn't even bother to put together a cogent argument against Warren; he simply links to a few bloggers and a Forbes columnist who complain that Warren is "unqualified" and that "the highly specialized world of bank resolution is not one where she has, as far as I can tell, very much expertise."

I do not possess expertise in the "highly specialized world of bank resolution" but I applaud Warren for insisting on TARP transparency, for pointing out inconsistencies on bailout programs ("The banks have received 10 times more money than the auto industry and yet they're receiving different treatment; Are the banks better managed than the auto industry?") and for caring that the interests of taxpayers are represented in the whole TARP process ("The people who are subsidizing the activities of the banks through their tax dollars are the same people who are furnishing the high profits through consumer lending," Warren told the Wall Street Journal "In a sense, we're asking taxpayers to pay twice.")

And I don't think that Warren's outsider status makes her unqualified for the job: indeed, it's the insiders who seem most ill-suited to fundamentally reforming the financial system (see: Summers, Larry).

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Knives Out for Elizabeth Warren | 23 comments (23 topical)

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The Warren Watch -count down until she is asked to (5.00 / 4) (#1)
by Bornagaindem on Wed Apr 22, 2009 at 09:59:37 PM EST

resign. Without Warren telling us about these things we would know nothing except what timmy wants us to know. She asks the right questions and gets no answers. I predict she is not long for her position because the last thing the obama administration wants is transparency about the lengths they went and will continue to to go to bail out the banks.

: Just like Brooksley Born (none / 0) (#3)
by imhotep on Wed Apr 22, 2009 at 10:59:13 PM EST

not a member of the Wall Street ole boyz club. She will be gone soon.
They're not listening to Stiglitz or Krugman either.
Geithner and Summers just taking care of their own, they way they do.

: The criticism (none / 0) (#9)
by reslez on Thu Apr 23, 2009 at 12:16:10 AM EST

was predictable. And the COP report was the product of a highly politicized process. Lots of weasel words: "arguably", "potentially", "could cause great harm", "poses significant fraud risks" (emphasis added). Hence the 3-2 vote with Republican apparatchiks in a row.
I thought the following was Yves' best point:
"I've never held a government job, and I'm not looking for a government job after this," she said. "I'm not out there trying to go and find my next landing spot."
The last statement makes Warren very threatening, needless to say. But Politico may be spot on in deeming her a Cassandra. Remember, her curse was to have her prophecies, which all were accurate, be ignored.

Qualified? (5.00 / 11) (#4)
by Peter G on Wed Apr 22, 2009 at 11:01:41 PM EST

Harvard Law School expert on bankruptcy, smart as they come, full of common sense, cares about ordinary people and the public interest, straight talker, afraid of no one, and female. Of course, she's "not qualified."

: Ouch. (5.00 / 4) (#6)
by nycstray on Wed Apr 22, 2009 at 11:15:16 PM EST

and not one of "the Boyz".

I've been following Elizabeth Warren's work and (5.00 / 6) (#12)
by Daniel Millstone on Thu Apr 23, 2009 at 06:49:11 AM EST

my take is that she's been just wonderful. She's extremely careful and thoughtful. She noticed the impact of Bush economic policies on ordinary people long before "experts" did. Her work on TARP has been superb. Do we want a Goldman-Sachs alum as watch-dog? Of course the banks do but the rest of us are much better served by her.

This has all been a very strange experience (5.00 / 3) (#13)
by Militarytracy on Thu Apr 23, 2009 at 07:17:59 AM EST

for me overall because it fits to a "T" everything my grandfather taught me about investing and capitalism. He told that if I ever forget this is all extremely cyclic (and some of the cycles nobody wants to acknowledge) I will lose my ability to make money on my investments. We went to talk to a financial counselor last week. I wanted to know if anyone out there could watch this stuff for us because sometimes it feels like a heavy load for me. I guess it sort of scares me and if I screw up I'd like it to be someone else's screw up. He took a look at where our money was and said, "Why did you do this?" "Nobody should do this until they are close to retirement!" I told him that I had done that because I sensed that the derivatives crap going on was destroying the market (and I had no idea about the CDS situation......the only thing at that point going on for me was that something was growing false markets and I didn't know what it was but I knew it was there).......so I pulled it out. He told me that I missed some terrific market times though. I packed my stuff up and left. I'll have to watch this stuff myself and be responsible for myself and he won't be getting any of my babysit my money money. He didn't even take a moment to notice that what I had left in the Roths that remained in the market were now half of what it was when I moved everything and they were doing super crappy then and had lost a great deal. The huge chunk that I moved, overall I made about 3 percent on and held onto its worth while everyone staying in the 401k game has lost more than half. I now have money to loan at a time when nobody can make loans because of insolvency. My grandfather and everything he taught me was right on.....Elizabeth Warren is right on.....but I'm feeling sad because it is lonely living in the real world right now mostly by myself.

: Did something similar myself (5.00 / 1) (#20)
by FreakyBeaky on Thu Apr 23, 2009 at 10:26:15 AM EST

Moved everything except a tiny shred out of anything stock or bond related and into super-ultra-conservative territory a while ago ... and it's going to be a while before I move back in. As I told a co-worker, I'm waiting until the solvency crisis is over (he thinks it's a liquidity crisis). He criticized me for being a pessimist. What, moi, pessimistic? :-)

Qualifications... (5.00 / 6) (#17)
by Ethan Brown on Thu Apr 23, 2009 at 08:22:43 AM EST

I agree with reslez: "I haven't seen anything so far that would indicate she's out of her depth or lacks understanding of the issues. Have you?"

Warren critics can't seem to answer this question: all they do is point to her resume.

Which proves nothing: one of the strongest voices on criminal justice system reform right now is Sen. Jim Webb and he's certainly no criminologist.

Here's what the Warren critics don't get: outsiders are often necessary when institutions--banking, the criminal justice system--have collapsed.

Some of you may like her, (1.66 / 3) (#2)
by Green26 on Wed Apr 22, 2009 at 10:23:07 PM EST

but she is not qualified for the job, nor does she appear to be suited for the job.

Elizabeth does know what she is talking about (5.00 / 1) (#5)
by rottodamn on Wed Apr 22, 2009 at 11:13:44 PM EST

Check out her Berkley talks on youtube!


Specifics Please (5.00 / 1) (#7)
by Ed on Wed Apr 22, 2009 at 11:56:06 PM EST

It's easy to wave your hands and say she's not qualified, but how about a few specifics? What education, skills, or experience should she have but doesn't? Who would you propose that meets your criteria?


Speicifics. (1.66 / 3) (#10)
by Green26 on Thu Apr 23, 2009 at 03:16:57 AM EST

She has no apparent knowledge, expertise or experience with the banking system or Wall St. Geithner is trying to fix the financial crisis, including the big banks and big lending.

She is a professor of bankruptcy and contracts. Those have little or nothing to do with the financial crisis.

Her most common and prominent writings are on consumers and the middle class.


It's rather simple (5.00 / 4) (#11)
by koshembos on Thu Apr 23, 2009 at 06:48:42 AM EST

Banks are straightforward organizations; they can be understood by a high schooler. What caused the current crisis is the banks' attempt to go into business that way too complex for them to understand. (See Nassim Taeb) The morose of CDSes, derivatives and other risky undertaking brought the banking to their knees. If it weren't for Obama's allergic reaction to taking Citibank and BofA over, we wouldn't have to play around with the bunch of greedy and unqualified personnel that runs the banks now.

Warren is more qualified than most identifying unfairness, lack of transparency, prejudice and corruption.


: Banking May Be... (2.00 / 1) (#23)
by santarita on Thu Apr 23, 2009 at 11:14:47 AM EST

straightforward but large financial institutions do much more than banking. Could a high schooler understand international financial transactions?
Warren may be more qualified than most but that doesn't necessarily mean that she has the experience, skills and knowledge to do the best job.
Having said that, I'm not sure that she lacks the qualifications to do what Congress wants in the head of a Commission. That panel should be basically educating Congress and asking the right questions. Sometimes a person not so closely immersed in the enterprise can ask the fundamental questions that need to be asked.

Timmy's only essential qualification... (5.00 / 4) (#16)
by lambert on Thu Apr 23, 2009 at 07:53:35 AM EST

... is sucking up to whoever's his boss at the time.

Warren doesn't do that -- and so of course she's profoundly threatening to the banksters, their enablers, their propagandists, their bookkeepers, and their trolls.


: It has taken a bit for my husband (5.00 / 2) (#18)
by Militarytracy on Thu Apr 23, 2009 at 08:40:51 AM EST

to fully understanding what is going on within our economy but he truly wants to understand so I pick out things for him to read that usually don't make the front page, and I tell him what has happened here and there because his daily job focus goes completely elsewhere. He went with me to "interview" the money babysitter. When the guy went off on how stupid I was my husband told him that I follow philosophies that seem to be in line with Krugman, Stiglitz, Galbraith....etc. The dude told my husband that that was obvious, but he is licensed and he knows things that we don't know and I guess things that Krugman, Stiglitz, Galbraith don't know either......he goes to big meetings with reps of the investment firms. My husband told him straightfaced that he was obviously part of what is broken and that if he's a playa not only his opinion biased but at this point it is tainted....and we left shortly after that :)

Tone Deaf (5.00 / 3) (#19)
by FreakyBeaky on Thu Apr 23, 2009 at 10:18:54 AM EST

Her most common and prominent writings are on consumers and the middle class - and that disqualifies her?!?!?!?

After all, those are just the little people.


Heads of Commissions Need... (none / 0) (#22)
by santarita on Thu Apr 23, 2009 at 11:07:16 AM EST

not be experts in the field. They need administrative capabilities, they need to be able to identify and hire the necessary expertise and they need to set the proper tone of objectivity, clarity and transparency.

I thought that Warren showed all of the above when she hired a variety of valuation experts to determine whether or not the government had gotten a good deal on some of the Paulson TARP deals.

Her most recent efforts show a little less objectivity - I think she has already predetermined that Geithner is going down the wrong path and is reluctantly admitting that his approach may work.

But she is only one member of that Panel. She's more qualified that some of the others on that Panel. The only one that has the qualifications is the NY State Banking Commissioner.


Frankly (5.00 / 3) (#8)
by reslez on Wed Apr 22, 2009 at 11:59:25 PM EST

I'm amazed she got the job. I can't imagine how it came about. But I haven't seen anything so far that would indicate she's out of her depth or lacks understanding of the issues. Have you?

I've crossed swords with you before on the topic of Warren's credentials. Further disparagement on that basis amounts to an ad hominem attack. We've seen Warren's testimony and the committee report. I invite you to respond on the merits.


10,9,8.... (5.00 / 2) (#15)
by lambert on Thu Apr 23, 2009 at 07:50:34 AM EST

and right on schedule!


: Piecework? (none / 0) (#21)
by lambert on Thu Apr 23, 2009 at 11:01:19 AM EST

Or hourly rate? I'm guessing hourly.

Your game is going away (none / 0) (#14)
by Militarytracy on Thu Apr 23, 2009 at 07:19:34 AM EST

Sorry, but it is. They bankrupted the system again.
