The Corner

Bankers’ Lobbyists Love Elizabeth Warren

Ryan Lizza, writing in The New Yorker, has an interesting piece about Senator Elizabeth Warren getting into bed with bank lobbyists.

In bed with bank lobbyists? Please don’t pretend to be surprised by that.

Every regulatory effort creates winners and losers, and in the case of Warren’s campaign for the Dodd-Frank bill and the creation of the Consumer Financial Protection Bureau, there were financial-services firms on both sides of the line. Because the most cumbrous and invasive of the Dodd-Frank provisions apply only to the largest firms, the smaller firms saw an opportunity to use regulation to create for themselves new competitive advantages and profit opportunities. These aren’t mom-and-pop businesses, but banks that often have hundreds of millions of dollars in assets — not Goldman Sachs, to be sure, but not Mayberry Main Street, either.

Warren developed a working relationship with Camden Fine, “the head of the Independent Community Bankers of America, who is considered by some to be one of the most powerful lobbyists in Washington,” as Lizza puts it. Fine held the academic-activist in contempt — “this loopy woman,” he called her — but saw that she could be useful to his clients’ financial interests.

Oddly, Lizza concludes: “Warren effectively co-opted Fine and his members as allies against Wall Street.” In reality, that is almost the opposite of what actually happened, as Lizza’s own very interesting piece makes obvious. Warren did not coopt the bankers’ lobby; the bankers’ lobby coopted her.

ICBA members together hold more than $1.2 trillion in assets, the poor dears. Walk around lower Manhattan and you’ll see plenty of its member banks. Giving First American International or Provident a leg up on JPMorgan Chase isn’t banking reform — it’s political favoritism. You expect that from the lobbyists — that’s what they’re there to do. 

And, if you are paying attention, you should expect that from Senator Warren, too. She is not what she pretends to be.

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