EDITORIAL
Elizabeth Warren
Published: July 24, 2010
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President Obama should nominate Elizabeth Warren to head the new Bureau
of Consumer Financial Protection, and not only because of her credentials.
Ms. Warren --- a bankruptcy expert at Harvard Law School, an Oklahoma
native whose father was bilked of his savings by a business partner ---
developed the idea for the bureau in a 2007 article. Since then, as head
of the panel that monitors the bank bailouts, she has become one of the
nation's most prominent consumer advocates.
There are other candidates, of course. What Mr. Obama needs to recognize
is that this particular job, at this particular time, is about more than
competence. As the reform bill went through Congress, the banks were
unrelenting in trying to kill or weaken the bureau. Having failed, they
want influence in selecting its director.
Meanwhile, polls have shown public mistrust or misunderstanding of the
administration's economic policies. Mr. Obama's choice to head the
bureau must demonstrate that he cares more about ordinary Americans than
about Wall Street, that he understands that the public interest differs
--- sometimes sharply --- from the interests of big banks. He needs
someone the banks do not want, and that someone is Ms. Warren.
Bank lobbyists say a regulator like Ms. Warren would overreact in
protecting consumers from abusive loans, constraining needed credit.
That is unfounded. In her academic work and in the 2007 article
introducing the idea of the bureau, Ms. Warren has shown that she
understands the power of credit to do good.
But she also knows credit can wreak havoc. In 2007, she wrote: "For a
growing number of families who are steered into over-priced credit
products, risky subprime mortgages, and misleading insurance plans,
trust in a creditor turns out to be costly. And for families who get
tangled up with truly dangerous financial products, the result can be
wiped-out savings, lost homes, higher costs for car insurance, denial of
jobs, troubled marriages, bleak retirements, and broken lives."
The banks don't oppose Ms. Warren because she doesn't get it. They
oppose her because she does.
A version of this editorial appeared in print on July 25,
2010, on page WK7 of the New York edition.
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