Why Are Republicans So Keen to Persecute Elizabeth Warren?

Posted on by

The House Oversight and Government Reform Committee session today with the Republican’s favorite punching bag, Elizabeth Warren, managed to notch abuse up to a level that is politely described as unseemly or more accurately called Republican Derangement Syndrome.

The fact that Republicans’ last effort to use screechy and mean against Warren failed to deter her has not led them to improve their game. Two months ago, a nasty two hour Congressional hearing with Warren was the culmination of weeks of right wing media attacks, with the Wall Street Journal leading the pack. We noted:

The last time I can recall the Journal becoming quite so unhinged about an individual was over Eliot Spitzer. And since Warren seems pretty unlikely to be found to have similar personal failings, the specter of the right throwing what look to be ineffective punches at her makes for a peculiar spectacle. What is the real aim behind this drama?

The reactions to Warren, both on the right and left, are becoming divorced from reality. She has assumed iconic status as a lone mediagenic figure in the officialdom who reliably speaks out for the average person, a Joan of Arc for the little guy. And she drives the right crazy because she is rock solid competent and plays their game better than they do. She sticks to simple, compelling soundbites and images without the benefit of Roger Ailes and Madison Avenue packaging, and she speaks to an even broader constituency, Americans done wrong by the banks, than they target. No wonder they want to burn her at the stake.

Today’s spectacle had the Republicans looking like idiots who resorted bullying when their initial salvos failed to hit their target. Chairman Patrick McHenry came off like a an angry amateur, trying ineptly to play prosecutor by demanding yes and no answers to questions that were clearly setups or couldn’t be answered that simply. The problem is that this tactic works only if you have legitimate questions and keep your cool.

Another Republican, Trey Gowdy, tried this trick and when Warren patiently explained why a yes or no answer couldn’t be accurate, he simply got more and more pissy. Earth to base: you won’t find “pissy” on any map of moral high ground.

And do these Republicans have the foggiest understanding of Dodd Frank or banking regulators? It appears not, which means they also must have incompetent staffers, since any good subordinate’s job is to keep his boss from looking stupid. For instance, Representative Ann Marie Buerkle had a long windup question (meaning she was largely speechifying) criticizing Warren for having job postings where the pay levels were considerably higher than those for similar-skill-level Federal jobs. Warren explained that the compensation levels were set not by her but by Dodd Frank, using the salary grades in place for other Federal banking regulators. Buerkle simply refused to listen to Warren’s response and simply rephrased her question as a more pointed accusation that Warren was being irresponsible and wasting government money. One of her constituents wrote me:

I really want to punch my rep. She was second in line, pretty damn good for a freshman who forgets to pay her property taxes. All loaded questions/statements.

The Republicans also demonstrated ignorance of the process by which legislation is interpreted and implemented (they seem to see Warren as some sort of “decider”) and accused the CFPB of having unprecedented power when in fact it is the only banking regulator that is hobbled by the need to get approval from the FSOC and a budget ceiling. The most peculiar bit was her being hectored for things that were not her doing, such as the five year term for the CFPB director and the fact that it is self funded (both part of Dodd Frank and the norm for banking regulators), the afore-mentioned pay scales, or for CFPB directives drafted by Congress. Adam Levitin provided a useful summary which the Oversight Subcommittee members might familiarize themselves with (click to enlarge):

Warren appears to have riled them further with her deliberately-paced, detailed answers. At points it did look like an effort to run the clock out a bit (not unreasonable given the puerile questions and open hostility), but it was at least as much Warren’s native communications style, which is to speak in a way that mainstream Americans new to this topic could understand. Warren simply outclassed her opponents, which was further fuel for the fire.

The Democrats were trying hard, perhaps a bit too hard, to back her up in the face of gratuitous nastiness. They for the most part got good substantive points in but sometimes came off as fawning.

So even though the exchange that garnered media attention occurred when McHenry accused Warren of being dishonest, the entire Republican performance was only a hair’s breadth above this level:

It’s instructive to see the context (they spar a bit a starting at 56;00 and really gear up at 1:02 till 1:09). Gawker has made the Warren reaction an official “How to Respond When a Congressman Calls You a Liar” And it was McHenry that was way off base; I found out shortly after Warren was pilloried that the schedule had been changed four times by the Committee, including one move made via a staffer late last night.

I’m not sure what the Republicans are trying to accomplish. This move backfired on them. It’s given Warren more media time. But the New York Times is so loath to look like it was supporting Warren that its story comes awfully close to damning her with faint praise (doubters should contrast it with the more evenhanded account in the Wall Street Journal). It starts with two paragraphs of McHenry’s charges and does not give the Warren rebuttal its due (they say she “denied…saying that she clearly stated in March” when she read from a letter she had sent in March). It also, in too many cases, quotes McHenry directly (which makes him sound more forceful) and summarizes Warren’s replies. It also dignifies this rant by reproducing it:

Mr. McHenry did not back down. After the meeting broke, he said in a statement: “I was shocked by Ms. Warren’s blatant sense of entitlement. She was apparently under the assumption that she could dictate a one-hour time limit for her testimony to Congress, and that we were there at her behest instead of the other way around. This is just further example of her disregard for Congressional oversight.”

A full nine paragraphs later, at the very end of the article, we finally see a defense:

Those exchanges led a Democrat on the subcommittee to apologize “for the rude and disrespectful behavior of the chair.” Representative John Yarmuth, a Kentucky Democrat, said to Ms. Warren that Mr. McHenry’s accusation “indicates to me that this hearing is all about you, because people are afraid of you and your ability to communicate in very clear terms the threats to our consumers.”

So why is the Times so generous to this Republican nonsense? The article makes it clear that it is simply echoing orthodox Democratic thinking, which to move Warren into another role. By implication, she is obtusely refusing to play ball:

Faced with strong opposition to Ms. Warren, a Harvard professor, President Obama has not nominated her to lead the new bureau. In fact, officials in the Democratic Party are trying to pressure her to return to Massachusetts to run for the United States Senate in 2012/

The “not nominated her” remark is true but disingenuous. Team Obama hasn’t found anyone credible who will take the job, particular now that the Republicans have made it clear they will torture anyone who dares take the post seriously. And given that the agency head is required to be in place by July 21, an impossible timetable for a normal confirmation process, any chief will have to be a recess appointment. (And the continued descent of Congress into bipartisan rancor makes the idea of becoming a Senator far less appetizing than it would otherwise be).

The whole point of turning Warren into an advisor to the Administration was to get her inside the tent pissing out. That was important because she is so well liked by journalists and so effective on TV that the Administration wanted her out of the limelight. But these Congress-administered beatings are the polar opposite of that strategy, and serve to increase her profile and credibility.

I don’t see how Warren wins this game near term. Obama has cast his lot in so firmly with the banks that he seems very unlikely to appoint her, particularly with him all too willing to use Republican brinksmanship and threats of further hamstringing the CFPB as an excuse to do what he wants to do anyhow, which is move to the right. But that strategy is looking less sound, particularly in light of an upset Democratic House victory in a normally secure Republican district, the hot button issue apparently being proposed Medicare cuts. Nevertheless, Warren at a minimum will make Obama’s and Geithner’s refusal to have her lead the CFPB visible proof of their cravenness.

To have her success be leaving the Administration with a Pyrrhic victory may seem a foolish and unworthy goal. But she has already put important processes in place even in the start-up phase, which will influence how the agency operates in its early days and could prove to be durable. Even more important, consider what our reader Richard Kline has said about the nature of political change:

The nut of the matter is this: you lose, you lose, you lose, you lose, they give up. As someone who has protested, and studied the process, it’s plain that one spends most of one’s time begin defeated. That’s painful, humiliating, and intimidating. One can’t expect typically, as in a battle, to get a clean shot at a clear win. What you do with protest is…you change the context, and that change moves the goalposts on your opponent, grounds out the current in their machine.

Warren’s opponents both inside and outside the Administration see power only in institutional terms: that if she ultimately does not head the CFPB, she cannot have much impact. But they miss the fact that the more they fight with her, the more they enhance her status as spokesman for ordinary Americans. No matter what she does next, her most potent weapon is her ability to continue reframing the debate.

Print Friendly, PDF & Email


  1. JustMe

    Love the Gawker GIF — it’s perfect!

    Please, can we have her as President? I could adore this. I think all the Senate talk is misdirection; Warren won the Firedoglake presidential poll a few months ago. And you called it right: “But they miss the fact that the more they fight with her, the more they enhance her status as spokesman for ordinary Americans. No matter what she does next, her most potent weapon is her ability to continue reframing the debate.”

    okay, back to the GIF… :-)

    1. DownSouth

      • “But they miss the fact that the more they fight with her, the more they enhance her status as spokesman for ordinary Americans.” ▬Yves

      Watching McHenry’s performance reminds me of something Martin Luther King, Jr. said:

      The nonviolent strategy has been to dramatize the evils of our society…

  2. DownSouth

    Why senate? Why not president?

    Wouldn’t that force the issues out into the open? Cut through all the kabuki?

    When the knives came out for her on both side of the aisle, wouldn’t that show Americans what a fraud both parties are?

    The purpose of the Democratic and Republican parties is to prevent the American people from having any real choices.

    1. BDBlue

      She should absolutely run for President. Would she win? No. But again, it’s not about winning, it’s about fighting.

      As for the Senate, I can think of no better way to sideline someone and make them ineffective (other than, of course, as a way to serve the (D) party’s fundraising and organizational needs). As this comment on Greenwald’s blog astutely captured, everything in the Senate happens behind closed doors because that’s how both parties want it. We don’t need another Bernie Sanders. We need someone outside the corrupt institutions. Right now that isn’t Warren, but eventually her fight within the Administration will be over. I hope at that point, she’s willing to take the fight outside once again (she seems like the kind of person who would, but I’ve been wrong about people before).

      Of course, we can’t wait for a leader, we must all do our part every day, but that doesn’t mean individuals such as Warren don’t have the potential to make a big difference.

        1. DownSouth

          Either way, I think we can all agree as to the reason why Warren is so feared, and hated. Both the Republicans and Democrats are so morally and intellecutally bankrupt that anyone with outstanding courage and a sincere and truthful message is bound to have great appeal to the American people.

          To quote MLK again:

          The power of the nonviolent march is indeed a mystery. It is always surprising that a few hundred Negroes marching can produce such a reaction across the nation. When marches are carefully organized around well-defined issues, they represent the power which Victor Hugo phrased as the most powerful force in the world, “an idea whose time has come.”… When the idea is a sound one, the cause a just one, and the demonstration a righteous one, change will be forthcoming. But if any of these conditions are not present, the power for change is missing also.

          I don’t know that Warren is MLK material. Time will tell. The only other possible contender on the scene that I can see is Chris Hedges. But sometimes I think people are too quick to forget that Gandhi and MLK had to go through an apprenticeship, that they weren’t always the way we remember them and had to learn through the experience of doing.

          1. SqueakyRat

            Her rise has been remarkably rapid. Three years ago she was a respected, but obscure, academic policy wonk.

  3. /L

    Why Are Republicans So Keen to Persecute Elizabeth Warren?

    Isn’t that apparent?

    Warren is a respectable honest person who thinks the society should be just and fair. Those kinds of peoples have to be persecuted by the mean and evil, the Warren kind of people are a lethal threat to their very existence.

    1. Tao Jonesing

      I think you’re probably right. The problem for Warren was that she chose join the Obama administration and thus tarnished herself to a certain extent. She had the most credibility as a complete outsider.

      1. Pixy Dust

        Tao what good is credibility if you’re an outsider?
        Nice, but ineffective and irrelevant.

        1. Pixel Rust

          Within this Twisted World the power behind the throne swings 9 times the power of the sitting pretender. Elizabeth is not the power but her logic could change the Nation.

          We have tasted the waters of her thought

  4. tommygun

    “And since Warren seems pretty unlikely to be found to have similar personal failings…”

    Fucking 5-star prostitutes is not a personal failing. It’s called winning.

    1. DP

      Yves, the comment I’m responding to should be enough to get the person who made it banned from your site unless you’d like this blog to turn into Zero Hedge.

      1. Embarrassed to Have to Say This

        Wow, am I really taking the bait here? I guess so!!

        Sorry, but no and no.

        1. Spitzer did not have to pay for sex. He chose to. He presumably could have had his pick of eligible women given his status and power. He was trying to buy silence and discretion, not intercourse, which he could have had “for free.”

        2. Although I have never paid (or accepted money) for sex, I think it is insulting and blind to demean two people for coming to an agreement that one would like some sexual gratification and the other would like some money. Whatever, you can define the label ‘loser’ however you want, but this topic makes you seem out of touch with the reality facing many people who want sex (and/or compensation) and don’t have reliable means to get it. We all like to judge, especially with something that we’ve never experienced and are not even blessed with the background to understand. [NB: This is not solely a male/female issue, as I know more than a few women who enjoyed the sanky panky now and then].


        1. F. Beard

          I agree with Yves.

          Plus, it seems pretty stupid to risk a fatal disease by going where many have gone before. And stupid = loser.

        2. craazyman

          “[NB: This is not solely a male/female issue, as I know more than a few women who enjoyed the sanky panky now and then].”

          Did you make any money off them?


          Send them to my ship! I will take them all, free of charge.

          -Captain Jacques de’Love
          Le Bateau Ivre
          Tortuga Harbor


          It’s been my experience that I have been paying for sex my entire life, in one form or another… As a matter of fact, I’ve never paid for sex with what you would define as a prostitute.

          Regardless, Eliot Spitzer’s having paid a protitute for sex does not diminish his his aptitude for prosecution…

          I don’t view myself as a looser in any form way or fashion…

        2. Liz

          It’s really funny that Yves’s comment hit a nerve, but why wouldn’t it? Every time the stock market is up, bands of young MBAs can be seen prowling for prostitutes all over Manhattan’s red light districts.

          In their small minds where everything has a price and everything is for sale, they can’t even imagine a world in which sex is given freely. Sad, and loserly.

        3. craazyman

          dude, that’s the funniest one-liner I’ve ever seen on this web site. :)

          I was laughing out loud, to myself, for at least 30 seconds.

          well done.

          1. Yves Smith Post author

            Not his, Barry Diller said something very much like that at least a decade ago.

  5. tz

    Tell me again why anything useful will come out of the new agency when Obama and the democrats had full control to appoint nearly everyone at the other agencies listed, and they are actively avoiding doing anything effective? This has been over the same time period.

    Wouldn’t it have been better to replace the people at the OCC, SEC, etc.?

    And I think the GOP is merely throwing Obama’s “We Won” reason for forcing something evil through back in his face.

    The fatal flaw with regulation is you eventually get someone in office who will allow regulatory capture – and the follow-on administration will likely get more than enough lobbying money and/or campaign contributions to leave the status quo indolence alone.

    Why work so hard on this battle when 2 years from now if we get a GOP obama-bush-clinton clone from the -R side, they will simply neuter the agency – or worse make it actively destructive of the individual.

    I’ve seen this game for several decades. Something bad happens which the existing agencies failed to stop or do anything about afterward. The Congress creates an agency specifically to stop it. The first few months it appears to do that. Then the industry starts co-opting the agency, by who gets hired, appointed, etc. After a few elections the agency works for the big players and if they do anything, it is to crush the little guys or buys a lot of stuff from some corporatist crony. Then something bad happens…

    Not just financial, consider the DHS and the TSA. Or the FDA destroying small toy makers that can’t possibly test for Lead (while Mattel gets to use their in-house lab), or the current efforts to destroy organic and other natural farming on the same basis.

    Einstein said insanity was doing the same thing and expecting different results.

    When you increase the power someone in Washington – not mainstreet – has, it becomes a target for corruption as per Acton. Name a few agencies that haven’t been corrupted. “But this time it’s different”?

    Continue the game if you must, but by 2013, or 2017 at the latest, this new agency will either be toothless or ripping into the good-guys.

    1. Been there

      This is absolutely true. What is scary is I don’t think the existing regulators could have built the expertise to handle the scope of what the CFPB is tasked with in the same time frame. And that is with an existing infrastructure. I am afraid that the cult of personality that Elizabeth Warren has built is not going to live up to what is realistically possible.

    2. DownSouth

      Bull shit.

      What you’re hyping is the defeatist distortion.

      It was Clayton Williams, Republican candidate for Texas governor, who carried the defeatist distortion to such an extreme that people could see just how bankrupt the supposed logic is. Williams publicly made a joke likening rape to bad weather, having quipped: “If it’s inevitable, just relax and enjoy it”.

      1. Tao Jonesing

        “What you’re hyping is the defeatist distortion.”

        Or he might be demanding that we focus on creating real change and stop being mollified by toothless patchwork measures that are not designed to be lasting solutions.

        I can’t tell for certain, though.

        1. DownSouth

          I thought about that. But then tz says, for instance: “The fatal flaw with regulation is you eventually get someone in office who will allow regulatory capture…”

          But it’s not a “fatal flaw,” and the appropriate solution is not to get rid of regulation, unless of course you want despotic ape society, the law of the jungle. But human beings have about two million years of not opting for might-makes-right. The solution, the human solution at least, is to get regulators that aren’t captured. And if that means throwing a few corrupt regulators in prison, I’m all for it.

      2. tts

        No he is saying another agency is not the solution, its a red herring to pigeon hole Warren and give the hoi polloi the appearence of the administration doing something.

        This agency will be corrupted soon after Warren is gone if it isn’t already and will ultimately be about as effective as the SEC is.

        If you want to fix the regulatory capture then you have to stop the ones to aide or allow it, and that means the government. You need a sea change in our representatives, and that won’t come quickly or easily. Personally I don’t see it happening at all until a major crisis develops, and even then I think we’ll see the country slide further right straight into a fascist state.

        FWIW I voted 3rd party, no not Tea Party, but a random 3rd party. I don’t expect them to win, but I’d rather throw my vote away on a 3rd party then give it to another corrupt shitlord D or R.

    3. pebird

      I hear what you are saying, but sometimes you gotta run that lap.

      The alternative is to throw up your hands and say that even putting a finger in the dike is hopeless (not that I am immune to that argument).

      I think that putting good, strong people who still believe in fundamental fairness into the system is a good thing for the public to see, even if she only lasts a year.

    4. nonclassical

      All they would have to do is what has been done so far-defund the agency..in the name of “government efficiency”..

  6. fiscalliberal

    I think we need to frame the response. If Obama does not have the spine to appoint Warren in the recess, he clearly defines himself negatively. I suspect Warren polls very well, so Obama can win if he appoints her. He should spend a lot of time explaining himself to his base if he does not. His administration has a bad image regarding lack of prosecution in the face of blatent bank fraud. The public understands this very well.

    1. lambert strether

      The “spineless” Obama trope should be abandoned forthwith.

      Obama’s got plenty of spine when it comes to handing the banksters trillions, normalizing torture, starting new wars, and so forth.

      He’s doing what he believes in, just like the Ds generally. Why is this so hard for “liberals” to accept?

      1. francis

        Dishonesty is spineless by definition.

        Dishonest people like to pretend they’re alick, but I think if you look at your own experiences with the dishonest, they’re simply chickenshits.

        Obama is a tiny little man, of no character whatsoever.


      2. pebird

        I don’t consider that having spine – I don’t know what the morphological equivalent would be in an octopus, but something slippery, soft, and hard to pin down.

    2. Yves Smith Post author

      With all due respect, Obama has learned he can abuse his base and he sells them out at every opportunity. Look at his policy record. He’s been consistent on this front. All he has to do with them is win the beauty contest between Cinderella’s two ugly sisters. And the Republicans look mighty ugly right now.

      Obama’s most important constituency, far and away, is not his base, it’s big donors. And banks are very big donors, hence the odds that he will do anything meaningful to cross them are zero.

  7. Max424

    If Warren ran for President on an Independent ticket, both parties would stop at nothing to assassinate her character.

    If Warren’s “character” survived this particular assault, both parties would stop at nothing to assassinate some other part of her.

    Note: I like Liz. I’d like to see her live a long and fruitful life. So I say, pack her safely away in the tent pissing out, because really, there’s nothing she can do, it’s her, alone, pitted against the Beltway’s, Bipartisan Army of Destruction.

    (Also, I’d hate to lose Lizzy, because I find her sexy in a schoolmarm sort of way; which is of course, irrelevant).

  8. Demented Chimp

    Elizabeth Warren for President
    She really should throw her hat in the ring

  9. attempter

    On the one hand, for the Reps to behave so hysterically helps pump up the scam that Warren in the CFPB would change anything. So it helps keep the sheep herded.

    But this would also help make Obama look good if he actually appoints her.

    I suppose the Reps are banking on getting the best of both worlds – pretending that Obama is really thinking of helping the people here (really thinking of appointing Warren to a truly empowered position), but counting on Obama to cave in and not seize the opportunity to turn the scam to his personal advantage (that he’ll sell out Warren in the eyes of those who insist on seeing her as some kind of hero because they desperately need to believe in reformist elites). In that case, Obama and the Dems come out looking worse than when they started.

    1. jake chase

      Those republicans do not sound like idiots to the idiots to whom their appeals are addressed. Most intelligent people understand that what politicians say publicly is irrelevant. Unfortunately, this does not generally apply to intelligent people who vote Democratic. They are complete suckers for the things politicians say, which is how we get Presidents like Clinton and BHO and nothing changes except for them.

      Liz Warren bears a physical resemblance to John Lennon and is thus an ideal candidate for Republican attack. As to whether electing her to any office would change anything important, my guess is that it would not, except of course for her.

      1. attempter

        Unfortunately, this does not generally apply to intelligent people who vote Democratic. They are complete suckers for the things politicians say, which is how we get Presidents like Clinton and BHO and nothing changes except for them.

        That’s why I think the smart move for Obama would be to appoint her with great fanfare to this bogus, toothless position. That would appease many of the stupid “intelligent” liberals, even the ones who criticize him. He could continue with business as usual while pretending he struck a great blow against fraudsters.

        But here’s an example where we’ll see the incompetence and cowardice which lie alongside Obama’s malevolence, because if the Reps yell enough about it, he’ll probably cave in to them and not do what’s in his personal career interest.

      2. attempter

        Unfortunately, this does not generally apply to intelligent people who vote Democratic. They are complete suckers for the things politicians say, which is how we get Presidents like Clinton and BHO and nothing changes except for them.

        That’s why I think the smart move for Obama would be to appoint her with great fanfare to this bogus, toothless position. That would appease many of the stupid “intelligent” liberals, even the ones who criticize him. He could continue with business as usual while pretending he struck a great blow against fraudsters.

        But here’s an example where we’ll see the incompetence and cowardice which lie alongside Obama’s malevolence, because if the Reps yell enough about it, he’ll probably cave in to them and not do what’s in his political interest.

  10. mitchw

    Would someone explain why a scheduling conflict is even relevant? More Crossfire bull.

  11. Paul Tioxon

    The republicans clearly see the mechanism of bureaucracy has added another component with the CFPB. And it is inside the Fed, which is a mainstay of Tea Party animosity, in case you haven’t noticed. Please recall END THE FED black t shirts which are regularly worn at tea party rallies, I have seen these in front of Independence Hall in Phila. with Sen. Pat Toomey speaking. Even more damning, Elizabeth Warren is not only a natural born leader, she is a strategist, who has been advocating for the citizenry of America for years. She has gone out of her way to write books for popular consumption and then go out on the lecture circuit to tell people just had bad the banking practices are. And now, that people can actually see the $45 fine for spending $3 too much with their debit card has been outlawed, it might become apparent that the social fiction of our politics is about to be rewritten in their favor for a change. If this one person can rise up and through reasoned analysis and will, help enable legislation, as small as it is in the scheme of things, and then become the Presidential appointee to develop the organization, and become its first director, the dam may be opened up for others to advocate and agitate their way into more changes.

    Since there is little respect for the O’Bama administration here on NC, let’s just say Liz will be recess appointed as an venal act of shoving it up the republicans ass sideways from a weary President who makes a cynical move that will blow the gaskets of every birth certificate demanding inbred red neck piece of shit that has demeaned him every step of the way. Let’s make it about the substanceless kabuki street theater that DC politics has descended into. I am please to see her have a lock on the directorship and I hope the republicans continue to rage against the machine that is now being populated with people who are making regulatory calls in my favor, like the recent NLRB ruling against Boeing, calling their plant move an illegal retaliation against their Seattle based unionize employees.

    The republicans know an enemy when they see one. This bureau and this director will be one more area for them to have to expend energy fighting rather than taking up their favorite legislative initiatives such as tax cutting, prayer meetings against abortion and more prayer meetings for Terry Schiavo. The republicans have to now consider real legislation, not just socialize together in one big happy revivalist tent meeting, masquerading as the US Congress.

    1. Dick Nixon

      Republicans like Mark Warner perhaps? Americans hate, hate passionately, the grandiose attempts at theater on capital hill. The For Profit Stooges still think it is business as usual to have millions looking for work, ejected from their houses, turned down for food stamps, dying of preventable diseases, incarcerated, and we still allow Banksters to walk free.
      Incidentally, didn’t Liz appoint two former Wall Street bankers and a former Freddie Mac official to top positions at the Consumer Financial Protection Bureau?
      You know, the same enabling, profiting seeking, information hoarding investor bastards who never get prosecuted, fired and never get shown the door, like some hopeless country club filled with exiled Nazis clinking champagne glasses encouraging the masses to “An mein volk, you live in unt Democracy! Remember to vote!”

      1. Paul Tioxon

        Dear Dick,
        Thanks for your ham handed NAZI literary allusions, trying to prod voter suppression through trick reverse psychology mastered by Jackie Gleason on the Honey Mooners in his battle to manipulate Alice. I will STILL, personally, crank out over a hundred new Democrat Party members, registered to vote IN TIME FOR 2012. Happy Victory in NY’s 26th Congressional District, more to come.

        1. Boosh Resignation

          Most American workers now understand the two-party system to be an extension of corporate America:

          “Dodd’s single biggest campaign contributor over the course of his Senate career has been Citigroup, which has donated $427,694. ”

          Another big, vicious lie, came straight from our “Republican” President’s mouth:

          “Ultimately in this country we rise and fall together; banks and small businesses, consumers and large corporations.”

          1. Paul Tioxon

            That’s right the unspeakable has already happened and a desolate wasteland of toxic inhumanity rides roughshod o’er the land. Vote for Gus Hall and Angela Davis, that will reveal the stupid Americans in all of the plastic uptight middle class back yard bar b q bullshit. A vote for anyone that can actually get elected is cynical appeasement of your pathetic credit card stuffed wallets.

            On a lighter note. Here is where you can sign your real name, if you have the balls, to a statement for:


  12. virginia holder

    What Chas.Frith said,I smell fear……Along with Mary Shapiro in SEC (GS charges), Sheila Bair in FDIC. Regulatory agencies were eviscerated by Greenspan’s thugs and thieves. They can dish it out but, cower when it’s deja vu too.

  13. lambert strether

    It’s kabuki: Obama and the Rs are both saying: “Thus far shall the Overton Window move left, and no farther.”

    Warren wants financial forms to be more readable. This is laudable, but it’s not really in the same order of things as turning the banks into regulated public utilities, or sending their CEOs to jail for accounting control fraud.

    That said, I’d be very happy if Warren ran, but then again… I’ve heard the hope and change thing before, eh? Policy is all, and not the personality characteristics of the candidate. Remember the “community organizer” and “constitutional scholar” schtick?

    1. nonclassical

      How can people speak of “turning banks into public utilities”, when public utilities are being (PRIVATIZED) turned into banks for private profit?

      1. readerOfTeaLeaves

        The more that I consider the Financial Meltdown, the more that I see things stuck in a status quo that has an inertia that is sucking the energy out of any real hope of addressing very serious problems in a timely fashion, the more convinced I become that moving to a financial model where banks are treated as utilities makes a huge amount of sense.

        For instance, here is a link to Congressman McHenry’s Career Campaign Finance summary:
        Note this man has a career total of $1,200,000 from the FIRE sector, which is nearly double any of his other campaign finance funding. His second highest career total, at nearly $500,000 is ‘Ideological-Single Issue’. And this qualifies him to oversee the new agency intended to protect consumers from predatory lenders?!

        This link shows that for the 2010 election cycle, the banking sector gave total contributions of $21,817,571.
        Divide that figure into the 537 or so Congressional seats.

        If banking were a utility, then at least we could work on campaign reform.

        Meanwhile, we’re seeing obscene amounts of money being spent to elect people who – at least in the case of this GOP-led Congressional committee – show up to meetings with misinformation, then treat their witness with a rudeness that would not be tolerated in any professional work environment.

        I’m with whoever said this smells of desperation.
        It does please me to think the banks spent $21,000,000+ in the 2010 cycle to fund people who make asses of themselves, but I think it’s a formula for deplorable government and incompetent, overpriced banking.

        It appears that Warren actually believes that markets should work, and that in order for markets to work, buyers require clear information.

        Quite obviously, the banks do not want markets to work.
        The want to keep their information asymmetries, and the hell with capitalism and markets.

  14. F. Beard

    Why Are Republicans So Keen to Persecute Elizabeth Warren? Yves Smith

    Because Republicans are hypocrites; they only like government when it grants special privileges to banks and big business.

    In other words, they are fascists.

    1. F. Moustache

      I see it as more of a good cop, bad cop routine they play with the Democrats. In the end they are all just war and financial criminals.

      1. F. Beard

        The Democrats were initially against central banking. They need another Andrew Jackson.

        1. pebird

          Jackson helped to create the Panic of 1837 (poor President Van Buren) by paying off the Federal debt, requiring huge amounts of private debt creation to maintain the “money supply”. Getting rid of the 2nd Bank of the US really hobbled Van Buren. It led eventually to the rise of State banks (private banks with State charters), and a hodgepodge of regulations and private currencies (all with dollar denominations but different discount rates, depending on the particular bank).

          Look out for what you ask for, you might get it.

          1. F. Beard

            Jackson helped to create the Panic of 1837 (poor President Van Buren) by paying off the Federal debt, requiring huge amounts of private debt creation to maintain the “money supply”. pebird

            Good point but irrelevant to the present. A modern day Jackson would pay off the national debt with new debt-free fiat as it came due. And should that prove inflationary then taxes could be increased or subsidies to the rich reduced.

            Getting rid of the 2nd Bank of the US really hobbled Van Buren. pebird

            It shouldn’t have. The US Treasury has the right to issue paper currency even if the States do not.

            It led eventually to the rise of State banks (private banks with State charters), and a hodgepodge of regulations and private currencies (all with dollar denominations but different discount rates, depending on the particular bank). pebird

            It is an old trick of banks to get the government to accept their private money for taxes. The solution is separate government and private money supplies. Government money would should only be legal tender for government debts – taxes and fees – and private monies would be completely unacceptable except for private debts.

            Look out for what you ask for, you might get it. pebird

            Actually, what I want is principled money creation after a just bailout of the population. But of course any ideas for reform should be well brainstormed first.

          2. Yves Smith Post author

            You need to read your history. The banks engineered the panic to show Jackson who was boss.

    2. Paul Tioxon

      Here is more republican iron fisted politics. Anarchists couldn’t smash the state with anymore bile or rage…….

      Senators beg John Boehner to stop Obama appointments

      Read more: http://www.politico.com/news/stories/0511/55723.html#ixzz1NQ7pYmCS

      Gee, no connection to Liz Warren walking into the office she made. By the way, she took a breakfast with Silicon Valley wonderkids to make a website that would be as useful for protecting yr money as it is becoming as easy to give it up without a thought in a shopping cart.


      It is a really friendly looking site. Oooh, look here, an organization chart from the site, look at that, small community banks and credit unions, betcha Jamie Dimon is gonna get really POd.


  15. DP

    For Rep. McHenry to call Elizabeth Warren a liar is ironic given the persistent rumors that McHenry is himself living a lie as a not very well closeted homosexual while he claims to stand for Republican “family values”. One of his young male Congressional aides who gave McHenry’s home address in Gastonia, NC as his home address pled guilty to voter fraud for voting twice for McHenry in the same election. This aide also received a speeding ticket before 6 A.M. while he was driving from McHenry’s home to law school in Tennessee.

    1. F. Beard

      while he claims to stand for Republican “family values”. DP

      That is a fatal weakness of the Republicans – their hypocrisy. They claim to be for family values yet support banking which depends on theft of purchasing power.

      It’s too bad that liberals and progressives support banking too as long as they get to “regulate” it.

    2. Cheryl

      If true, he would just be one more in a long list of holier-than-thou Republicans living a life opposite of what they preach. Most of the liars are always pointing their fingers outward until they are caught in their own web of lies …. then they expect a pitiful, half-hearted dutiful apology to wipe the slate clean and allow them to continue in public service cheating us of our money and our deserved representation.

    3. Peter T

      Why this rumor spreading, especially if it has nothing to do with McHenry’s abysmal performance during the hearing? I think such rumors just cheapen and soil the valid points.

  16. Feverish

    Principle reduction must be rammed (in an elightened, peaceful display, of faux reverse snobbery) down the throats of the grifters. Fat Hicks can say whatever they want, and usually do, these days.

    1. Pixy Dust

      Why Feverish?
      I think ramming it in a forceful, demagogic style would be both definitive and entertaining.

  17. Eureka Springs

    Geithner Obama, the dynamic Shock Doctrine duo weakened her last position before and after appointing her. Why folks fail to remember that surprises me. Warren needs to quit pretending she can play ball, much less change the rigged game with these criminals from the inside… lest I firmly believe she’s just there to help them.

    Inside baseball is ludicrous when you remember the whole field is built on a criminal bipartisan toxic landfill. One square of new Warren sod cannot fix a thing.

    1. pebird

      If you want the public to see the same things you do, get rid of the cynicism. You have to let the system run this lap.

      Either Warren gets in and cannot effect actual change or Warren does not get in, showing that a reformer is not allowed into the system. Either way it is valuable public education.

      If I were a Republican member of Congress, I would want to delay this as long as possible.

  18. Fraud Guy

    There is nothing easier, and more unbecoming of a public official than to use the power of the gavel to make a witness appear small.

    At the expense of diminishing himself, McHenry nevertheless failed to make Warren look small. In fact, the opposite occurred.

    This must absolutely enrage him.

  19. Adam's Myth

    Follows naturally from the “stern father” mold of the post-2000 extremist, anti-intellectual, male-dominated GOP. What could threaten this more than an assertive woman who is smarter than you, knows more than you about your own job, and won’t back down? Of course they are frightened.

  20. Pixy Dust

    “The reactions to Warren, both on the right and left,” ?!
    In my observance the Left has no problem with a competent watchdog. I think WSJ is throwing a little sand in our eyes.

    This spectacle is not the first time Republicans looked like idiots. Several months ago, I watched this hillbilly gestapo subject an honest, dedicated, respectable MD to their agenda-driven criminal interrogation when they questioned him about Obamacare’s Medicare savings. These amateurs are nothing but punks and bullies who can’t win by legitimate debate. All they have to offer is “HELL NO”. These autocrats don’t believe in compromise and have said as much.

    Why does any honest, thinking, middle-class American take them seriously? Elizabeth Warren’s appearance makes obvious once again what mental midgets these intellectually-challenged, landed-gentry are. I’m sick of Americans’ safety and well-being held hostage to their constituents’ financial interests. They really seem to believe our country is their plantation and they are our masters.

    1. francis

      “In my observance the Left has no problem with a competent watchdog. I think WSJ is throwing a little sand in our eyes.”

      Yes, and Chris Bowers over at Kos is trying to Draft Warren to run against What’s-his-penis over in Massachusetts. Conveniently that would leave her unable to lead the CFPB, giving Obama an excuse to queef out of appointing her.

      Do you really think that’s a coincidence?

      1. Pixy Dust

        Don’t know, but I’ll have to check it out and get back to you when I have an opinion.

    2. Walter Wit Man

      Then why does the Left (or more accurately, Democratic partisans) support a president and a party that values these ‘crazy’ conservatives more than people on the Left?

      Why isn’t someone on the Left in Obama’s cabinet or on his commissions or high in his administration? Why does he ignore their policy advise and adopt neoliberal policy? Why does he nominate people like Alan Simpson, or refer to Paul Ryan as having a “serious” plan while he shuts out the left?

      The reason the “progressive” left, or Democratic partisans, look foolish with regard to Warren’s nomination, as the Republicans similarly look foolish, is that they are content to fight a symbolic fight that will surely leave them with a policy defeat. The left keeps getting suckered into these silly personality fights where they can’t even successfully rebut the silly conservative accusations of “socialist”! They put all their energy into these fights while they ignore the huge fundamental betrayals of their party (ahem, the Democrats are getting ready to cut Social Security and they just passed Bush’s tax cuts or the rich). The Democratic party is worthless and the fact that the Democrats are being led around the nose by the “hillbilly gestapo” says almost as much about them as it does the hillbilly gestapo.

      Why do Democrats support a party that listens to the Hillbilly gestapo more than it listens to watchdogs like Elizabeth Warren?

      1. Pixy Dust

        If I could answer that question Walter, I wouldn’t hold my nose and vote for the lesser of two evils every time I fill out my mail-in ballot.

        Having watched the Democratic Party lose it’s moral anchor after people like Walter Mondale, George McGovern and Jimmy Carter were defeated and marginalized, it was sadly obvious to even me that money would destroy the left and the Dems right along with it. That doesn’t mean I’ll stop ranting, railing and voting.

        1. F. Beard

          The Right’s Achilles Heel is their hypocrisy; they claim they are not thieves but are.

          Unfortunately, the Left is more concerned with nebulous “fairness” than simple honesty so they have no arrow for that vulnerable heel.

          1. Pixy Dust

            Our constitution’s preamble states:
            We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility…..

            I suspect it’s the phrase “establish Justice”
            You are correct. It is certainly a nebulous concept. But that shouldn’t deter us from trying to seek it.

          2. Pixy Dust

            Actually they were elected to represent and legislate.
            But they believe they were elected to govern.
            That’s why they’re unable to legislate.
            It requires debate, consensus-building, and compromise.
            Something they vehemently oppose.

          3. Pixy Dust

            Sorry F Beard.
            My second reply was to ChrisPacific below.
            (I wish there was a delete button.)

  21. Walter Wit Man

    It’s an intentional side show. A play. It’s something for the two parties to fight over as they both pursue roughly the same agenda. And it has the added benefit of being mostly symbolic and personalized. Ultimately, Ms. Warren probably would have only be a slight palliative effect on the neoliberal agenda and the focus on her obscures the role Congress play in setting regulatory policy.

    So of course the parties are using her as a straw woman to beat. The Democrats get to act like they care and really support changing the system by their half support for change, via her nomination (even though Warren probably doesn’t intend to, nor can she, really change the system) and the Republicans get to play the tough guys fighting against socialism. So both parties are partaking in the same ruse: that the Democrats are really, really, really trying to get some really, really, really liberal policy pushed through.

  22. Hugh

    The thing to keep in mind about Congressional hearings is that Senate hearings are filled with bloviating gasbags while House hearings are filled with not ready for primetime bloviating gasbag wannabes. Both are masturbatory exercises for members (so to speak). The House version is just far more inept and hamfisted.

    I think that the attacks on Warren are just part of the scorched earth approach to reform by DC politicians and the corporate interests that own them. When all is said and done, the CFPB’s mission was largely gutted at its inception in Dodd-Frank. It can’t prescribe or punish. It can only suggest, and that only in certain areas of consumer finance.

    Warren strikes me as a reformer who works within the Establishment. If you believe we live in a kleptocracy, you have to wonder what is the point in what she is doing. Kleptocracy can’t be reformed. It can only be replaced. Efforts at reform only give it a patina of legitimacy it does not deserve. I do not think Warren is a bad person, but what she is doing is distracting and ultimately serves the purposes of the kleptocrats more than those who oppose them.

  23. ECON

    I am not oblivious to other jurisdictions failings, but I must say America has a full-time circus of gross character defilement in Congress that eminently demonstrates the inability to enforce the legitimacy of this legislative body to the citizenry. America’s better days have faded from the vision especially after the Obama lack of spine since the election for “change you can believe in”.

  24. ChrisPacific

    I read the NY Times article yesterday. While I agree with your take on the overall spin, the last four paragraphs are damning. It’s very clear that there is no real substance to this and McHenry is just digging for dirt (and apparently failing at it, which may explain why he is so frustrated).

    If I was a voter my question would be: what was the point of this hearing, and why are you wasting time on this kind of thing when there is important work to be done? You were elected to govern. If you want to smear your political opponents, do it on your own time.

    1. Pixy Dust

      To ChrisPacific
      Actually they were elected to represent and legislate.
      But they believe they were elected to govern.
      That’s why they’re unable to legislate.
      It requires debate, consensus-building, and compromise.
      Something they vehemently oppose.

  25. Skeptic

    I dream of E. Warren as a Senator from MA and Bill Black as the consumer Honcho. Oh, to dream and be in love.

  26. MichaelC

    So much projection in these comments! As if any one of us know Warren well enough to think we know what her plan is.

    She’s a political enigma. I haven’t heard anyone make a convincing argument about what her end game strategy is. Every tea reader is in a tizzy. She’s a fascinating political character.

    She suffers fools with aplomb. Who else does that?? Fools in the Admin who think they’re playing her, Rep fools who think they can bully her, Dem fools who think a sidelining senate race trial balloon is credible, and bankster fools who recognize that she voices clearly and calmly every one of the reasons their retail customers loathe them. Fools that brought her into the tent, convincing themselves they could control her.

    I like to think she realizes the fools will trip over each other while she plods along doing her thing, confident the majority of the fools respect , and fear, her (and more important, fear the goals she’s setting for the CFPB) too much to really do too much damage to her mission. I also think its foolish to believe keeping her out of the top slot at the CFPB means the agency is dead. If O is foolish enough to pass her up, she’ll likely be a persistent thorn in his side, like Bill Black, but with an angry constituency in a presidential election cycle.


  27. Frank Zentura

    Well this is interesting and all but the unconstitutional Patriot Act is about to get extend another four years and the President is being given unilateral authority to assassinate and imprison US citizens! I feel bad for this woman but it won’t matter if we’re going to have dictators in the White House…

    Click on my name to see Ron Paul’s speech on this topic today…

  28. gepay

    I see a definite split here – between those who believe the system can be reformed and those who think it is beyond saving in its present form. If the system could be reformed then I would like people like Elizabeth Warren (the system works for her as she is a Harvard professor and so can believe that a meritocracy is still functioning) or Bill Black to be appointed to heads of agencies like the consumer finance agency. This also ties in with those who want the Federal Government to issue its own money> but what would be the gain if the Congress is already captured by the now legal corporate buying? So unless the corporations can be stripped of their faux personhood all of this is useless. Even then, they would still have control of the media. Maybe this blog is useful for sorting what parts of this system should be retained – what works. I think the present system has gone past the point of no return and just has to be let fail because of its own greed and stupidity. Hopefully there will still be a viable planet to inherit.

  29. Main Street Muse

    The GOP has repeatedly shown themselves to be the party that exists to protect the extremely wealthy. No wonder a woman (!!) who behaves and acts as a “spokesman for ordinary Americans” is being pilloried right now.

    [Which brings to mind the question: when did “ordinary Americans” become the enemy the GOP needs so badly to defeat?]

    Unfortunately, Warren stands alone right now. There is really no one else with the balls needed to advocate for the the vast millions of Americans who are outside of the Wall Street/Beltway cabal.

Comments are closed.