Warren, Manchin Win Seats on Senate Banking Panel

in In the News
December 5th, 2012

From American Banker
By Victoria Finkle
December 4, 2012

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, beat out GOP incumbent Sen. Scott Brown in a heated and expensive battle this fall.

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 petition to encourage Senate leaders to place her on the panel.

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 moments where those got contentious.”

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.

Read the full article at AmericanBanker.com (subscription required).