Wednesday, February 27, 2013

Elizabeth Warren Is the Opposite of Hillary Clinton - Businessweek

Elizabeth Warren Is the Opposite of Hillary Clinton - Businessweek:
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Photograph by Andrew Harrer/Bloomberg

Senator Elizabeth Warren (D-Mass.), left, and former U.S. Secretary of State Hillary Clinton talk during a Senate Foreign Relations Committee hearing

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Elizabeth Warren Is the Opposite of Hillary Clinton

Posted by: Joshua Green on February 25, 2013

Democrats Elizabeth Warren Hillary Clinton liberal Republicans Scott Brown Senate

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Ever since Elizabeth Warren defeated Scott Brown to win a Senate seat last November, Washington insiders (especially Democrats) have been intensely curious about what kind of a senator she would turn out to be. Warren’s political views aren’t the source of curiosity: She’s a liberal.

Rather, the mystery revolved around when and how she would use her considerable celebrity to advance those views, and whether she could succeed in the hidebound, stiflingly hierarchical culture of the Senate.

Hillary Clinton established a model for how celebrity senators are expected to comport themselves after she was elected from New York in 2000. When she first arrived on Capitol Hill, Clinton was mobbed by camera crews, which for weeks trailed her TMZ-style through the bowels of the Senate frantically trying to elicit comment. Clinton ignored all but the local reporters and took pains to avoid saying anything controversial. “I’m a workhorse, not a show horse,” was her constant refrain.

In a bastion of ego like the Senate, Clinton’s subordination of her own celebrity was shrewd politics, as was the elaborate deference she showed to her senior colleagues. Clinton stayed quiet for years. In meetings, she poured coffee for male senators. When Clinton was first elected, Republican Senator Trent Lott of Mississippi suggested that it wouldn’t be a terrible thing if she were struck by lightning. But by the end of her term, Clinton had co-sponsored legislation not only with Lott but with 48 other Republicans as well. She was a surprisingly effective senator.

Warren arrived in the Senate more of a crusader than Clinton, which only heightens the challenge a celebrity senator confronts: balancing one’s unique platform and the potential good it can yield against the resentment that outspokenness can arouse among self-important colleagues. As Clinton understood, this can undermine any senator’s effectiveness.

Initially, Warren appeared to follow the Clinton script. Though her media horde is comparatively smaller, she soon gained a reputation for giving national reporters the cold shoulder. But all that changed a week ago Thursday at a Banking Committee hearing on Wall Street oversight, Warren’s first as a senator. The hearing was a typically somnolent affair until her turn came to question the regulators testifying before the committee. Warren devoted the five minutes allotted her to the seemingly abstruse topic of banking settlements, such as the $1.9 billion fine the British megabank HSBC (HBC) agreed to pay the Justice Department last December after it wasaccused of laundering money for drug cartels (among other things).

In a short preamble, Warren admonished the regulators for not being more aggressive in taking big banks to trial, explaining how this harms the public interest. “If a party is unwilling to go to trial, either because they’re too timid or because they lack resources,” she said, “the consequence is they have a lot less leverage in all the settlements that occur.”

She continued: “We face some very special issues with big financial institutions. If they can break the law and drag in billions in profits, and then turn around and settle, paying out of those profits—they don’t have much incentive to follow the law. It’s also the case that every time there’s a settlement and not a trial, it means that we didn’t have those days and days and days of testimony about what those financial institutions have been up to.”

Warren was interrupted by applause from the gallery—something seldom heard at Banking Committee hearings. But her most effective line came afterward, in the question she posed to the regulators: “Can you identify when you last took [one of] the Wall Street banks to trial?”

Amazingly, none could. And the excuses proffered as to why they couldn’t reinforced Warren’s claim that banks that are “too big to fail” have also become “too big for trial.” “We have not had to do it as a practical matter to achieve our supervisory goals,” stammered Thomas J. Curry, the comptroller of the currency.

Warren’s exchange—which she posted on her YouTube page—quickly spread across political and news websites. Many people in and out of Washington are newly alert to the issue of bank settlements.

But her performance plainly violated the Clinton doctrine of maintaining a low profile. Will she pay a price?