Elizabeth Warren goes to war: Why the Democratic Party could seriously change -- for real, this time

Because she's now a party leader, some thought Warren might go easy on Wall Street. Here's what's really happening

Published December 12, 2014 11:59AM (EST)

  (AP/Susan Walsh)
(AP/Susan Walsh)

A few weeks ago, once it was confirmed that she’d been anointed as a new member of the Senate Democrats’ leadership team, I wrote a column urging Sen. Elizabeth Warren to focus on building a power base from within the party, and to ignore those calling on her to run for president. Going off of the example set by the conservative activists who successfully transformed the GOP from a center-right party into one situated much closer to the fringe, I suggested that if Warren really saw herself as on a mission, then she should work on moving the Democratic Party’s policymaking infrastructure to the left — and forget about moving herself to 1600 Pennsylvania. As recent experience has shown, it doesn’t matter how liberal a president is if the rest of his party is still in big money’s pocket.

When the piece first ran, it wasn’t really a prediction so much as a hope. I had no real insight into Warren’s thinking or her long-term plans. And the allure of the presidency must be overwhelming, especially when there are so many outsiders practically begging for you to run. It’s undoubtedly a much more romantic and exciting prospect than a decades-long struggle to move the unwieldy bureaucracy of the Democratic Party to the left. However, it may turn out that my column was rather unnecessary; because, judging by her speech this week to a group of financial reformers, Warren doesn’t sound like she’s readying herself for a presidential campaign. No, she sounds more like she’s readying for an ideological war.

Out of the many reports on Warren’s performance at the “Managing the Economy” conference, I thought the one Salon contributor David Dayen penned for the New Republic did the best job of situating her address within the framework of the fight that’s happening right now among Democrats over the party’s future direction. It would be impossible to categorize the groups perfectly (that Will Rogers quote about being a member of no organized party has endured for a reason). But, in broad strokes, the division is between neoliberals, who want minimal regulations on Wall Street, and populists, who believe Wall Street has become a threat to the middle class. Warren is, by far, the most recognizable member of the latter group, while the neoliberals, lacking a star of their own, have had to settle for Andrew Ross Sorkin, the wunderkind Wall Street reporter who’s repeatedly criticized Warren in the New York Times.

Recently, these two sides have been battling over whether President Obama, who is a member of the neoliberal contingent, should withdraw his nomination of Antonio Weiss to be the next undersecretary for domestic finance at the Treasury Department (which is the bureaucracy’s third-most-powerful slot). Weiss is currently an employee of the financial powerhouse Lazard, where he specializes in mergers and acquisitions, and from whom he’s set to receive a $20 million bonus if he takes the government job. Warren has argued that Weiss has no experience with the issues pertinent to the Treasury position in question, and that his selection is yet another spin of the revolving door. Being the fly in the White House’s ointment on this issue has predictably earned Warren some criticism from elites; but as Dayen shows in his report, the senator seems inclined to escalate the conflict rather than back down.

“We’d all scratch our heads if the president nominated a theoretical physicist to be surgeon general just because she had a background in science,” Warren said to the conference audience, responding indirectly to the barbs thrown her way by Sorkin and others. “It’s no less puzzling to nominate an international mergers specialist to handle largely domestic issues at Treasury because he has a background in finance.” More striking, however, was Warren’s decision to transition from defending her stance on the Weiss nomination to criticizing those who have built and maintained the revolving door — Democrats included. “Time after time in government,” Warren said, “the Wall Street view prevails.” After blaming this epistemic closure on the way Wall Street and fellow-traveling Democrats make it so Wall Street’s critics are “crowded out,” Warren then tied the dynamic to recent Dem-supported policies that, she believes, benefited the 1 percent at the expense of everyone else.

This is the kind of rhetoric you hear a lot from Democrats of all kinds during campaign season (though, of course, the blame is always laid entirely on Republicans). But it’s not the kind of rhetoric you’d expect to hear from a newbie senator with presidential aspirations, especially one who’d just been brought into the party’s inner circle — and especially one who’d already received tut-tuts from the Dems’ formidable neoliberal wing. (Running for president is very, very expensive.) What it is instead, as Dayen rightly notes, is the kind of rhetoric you’d expect from someone whose main goal is to drive Wall Street and its defenders “out of the temple of policymaking,” and to give the anti-neoliberal wing within the party, which has been growing in strength since the 2008 financial collapse, a direction and a voice.

And the fact that many high-profile Democratic senators — including Sen. Dick Durbin, Sen. Al Franken, Sen. Jeanne Shaheen and even Sen. Joe Manchin, the West Virginia conservative — are joining her in opposing the Weiss nomination shows that it may be working. For those hoping that Warren would respond to her ascension into the Dems’ Senate leadership by keeping her criticisms within the family, as it were, the speech was a bad sign. But for those who want to one day see Sen. Elizabeth Warren running the party’s economic policy, it’s a very good one indeed.

By Elias Isquith

Elias Isquith is a former Salon staff writer.

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