Elizabeth Warren Calls Out Wall Street

by Dollars and Sense

From James Kwak at Baseline Scenario; hat-tip to LF.

Although the Consumer Financial Protection Agency made it through the House more or less intact, the banking lobby is taking another, better shot at killing it in the Senate, and is planning to use the magic words: "big government" and "bureaucracy." Elizabeth Warren wrote an op-ed for Tuesday's Wall Street Journal that lays out the confrontation. For most of the past two decades, many Americans trusted the banking industry—not necessarily to be moral exemplars, but they trusted that the banks were basically doing what was right for customers and for the economy. Then in 2007-2008 that mood abruptly reversed, as it became apparent that unscrupulous mortgage lenders, the Wall Street banks that backed them, and the credit rating agencies had been ripping off mortgage borrowers on the one hand and investors on the other.

The big banks face a choice. They can agree to sensible reforms that protect consumers and rein in the excesses of the past decades. Or they can simply decide to screw customers, but do it openly this time, since they have so much market share it almost doesn't matter what customers think. How else do you explain, say, Citigroup's concocting a new credit card "feature" explicitly to get around a new requirement of the Credit CARD Act? Or Jamie Dimon saying that financial crises are something to be expected every five to seven years, so we should just get over it?

A year ago, it might have been possible to twist the banks' arms hard enough to get them to agree to new ways of doing business (such as a CFPA), because they needed government support so badly. Now it's too late. So the solution has to come from the other kind of arm-twisting—pressure from the president, the administration (that means you, Tim Geithner), and ordinary voters. If people feel screwed by the financial sector—and many of them should after the past decade—then they should want the CFPA.

But last month, Republican political consultant Frank Luntz wrote a memo laying out how Republicans could kill financial regulatory reform. "Ordinarily, calling for a new government program ‘to protect consumers' would be extraordinary popular," he wrote. "But these are not ordinary times. The American people are not just saying ‘no.' They are saying ‘hell no' to more government agencies, more bureaucrats, and more legislation crafted by special interests." The goal is simple: to make Americans think that the CFPA is their enemy, because it's part of the government, and that the banks are nice cuddly ewoks by comparison.

This is absurd.

We like to make fun of government in this country, but really, what are you and a few of your buddies going to do to fight JPMorgan Chase on your own? For all of our beloved rugged individualism (and our individual right to handguns), it doesn't do much good when you're up against your credit card issuer. There is no Chicago-school free market solution to an oligopoly that, on top of all its other advantages, has an implicit government guarantee that gives it a major funding cost advantage over its competitors. One of the purposes of government is to protect ordinary people from forces (hurricanes, terrorists, monopolies) against which free market forces do not provide adequate protection. This is why we need a Consumer Financial Protection Agency. And this is what Frank Luntz wants to trick people into forgetting.

Read the original post.

Labels: Baseline Scenario, CFPA, Elizabeth Warren, James Kwak

 

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2/09/2010 09:59:00 AM 0 comments

 

Elizabeth Warren Fights for the CFPA

by Dollars and Sense

A couple of recent pieces about Elizabeth Warren,chair of the TARP Congressional Oversight Panel, and her efforts to make sure that the Consumer Financial Protection Agency survives Senate efforts to gut or eliminate it.

First, from HuffPo:

Will The Banks Win Again?
Bailout Watchdog Rallies Support For Consumer Protection Agency
The battle in the Senate over a proposed consumer financial protection agency is the final show-down between banks and American families, bailout watchdog Elizabeth Warren wrote to supporters Monday night.

The outcome "will show whether we are going to let the industry continue to write the rules -- to keep the cops off the beat -- or whether the financial crisis actually changed something."

Senate Banking Committee Chairman Christopher Dodd (D-Conn.) is said to be considering dropping the proposed independent agency from the Senate's financial reform bill.

But Warren isn't giving up. "We have all worked hard to make the CFPA into a reality, and the next few weeks will determine whether our hard work will make a difference for families or whether families will lose once again," the Harvard Law professor and advocate for the middle class wrote. "The next few weeks will determine whether families will have to play by rules written by the banks and for the banks -- rules that let the industry get away with anything. In my view, we cannot let families lose again."

The new agency would be equipped with the power to write rules governing basic consumer credit products like home mortgages and credit cards, and would have the authority to regulate big banks and monitor their compliance.

Federal bank regulators, who focus on the safety and soundness of the country's banking system, are mostly concerned with bank profitability, consumer advocates and law professors say. Consumer protection has not been a priority.

But there's been a growing recognition that the lack of adequate protection for consumers helped cause the financial meltdown of 2008.

President Obama and his advisers have repeatedly called for such an agency, arguing that it's the best way to protect consumers from the big banks. The House passed a financial reform bill modeled on his proposal in December.

Read the rest of the article.

And this from Reuters:

Watchdog's fate in Senate key to financial reform

WASHINGTON (Reuters) - The tag on U.S. financial regulation reform may as well say "Made on Wall Street" if bank lobbyists manage to gut the Obama administration's proposed consumer watchdog agency, said Elizabeth Warren on Monday.

The head of a panel monitoring the government's bank bailout program, Warren is a Harvard Law School professor and a fierce critic of the banking industry. She is also rumored to be front-runner to become the first chief of President Barack Obama's proposed U.S. Consumer Financial Protection Agency.

The CFPA would be a new government regulator devoted to shielding Americans from financial rip-offs like the abusive subprime mortgages at the core of the 2008 financial crisis, and the prolonged recession and bank bailouts that followed.

But the proposed agency, already pared back last month in the House of Representatives, is in trouble in the Senate.

Under pressure from big banks fighting hard to kill or weaken it, senators are said to be discussing downgrading the CFPA from an independent agency to something less than that.

Such a move would undermine the integrity of the reform project overall and set up the United States for another cycle of financial predation, crisis and bailout, Warren said.

The Senate will reconvene on Wednesday with analysts expecting agreement in the banking committee on financial regulation reforms within weeks.

"The CFPA is the best indicator of whether Congress will reform Wall Street or whether it will continue to give Wall Street whatever it wants," she told Reuters in an interview.

"The question of who is in control is not going to be revealed by some nuance of how to deal with leverage ratios or credit default swaps clearing," she said.

"It's not that those issues aren't important; they are. But those are skirmishes on the edges of a huge battle over reining in an out-of-control industry. The CFPA has real teeth, and it is the centerpiece of meaningful reform."

SWEEPING PLAN

The Obama administration last year unveiled a sweeping plan to tighten bank and capital market regulation in response to an international financial crisis triggered by the bursting of a U.S. property price bubble and cascading follow-on effects.

The European Union is also pursuing ambitious changes aimed at preventing another crisis in the future.

Central to U.S. and EU strategies is finding new ways to deal with so-called "too big to fail" financial powerhouses, such as Goldman Sachs, JPMorgan Chase, Morgan Stanley, Citigroup and Bank of America.

So dominant have these firms, and a handful of others, become that old laws governing them no longer work. Writing new ones means tackling the complexities of over-the-counter derivatives, capital standards, leverage ratios and the like.

In the swirl of debate over such esoteric topics, Warren said it is crucial that consumer protection be addressed and that banks, seeking to protect their profit margins, not be allowed to squash changes that would help everyday people.

Consumer protection is relatively simple and could easily be fixed, she said. The statutes, for the most part, already exist, but enforcement is in the hands of the wrong people, such as the Federal Reserve, which does not consider it central to its main task of maintaining economic stability, she said.

Setting up the CFPA is largely a matter of stripping the Fed and other agencies of their consumer protection duties and relocating them into a new agency.

PROFITS THREATENED

The problem is that a strong CFPA directly threatens the banks' ability to sell confusing, deceptive, fee-heavy financial products that generate huge profits, Warren said.

That's why the industry -- for many years the leading source of campaign funds to Washington politicians from both parties -- is so adamant in opposing the CFPA, making it politically dangerous for lawmakers to back it.

Warren said she is skeptical that the CFPA could be effective if it became a division of another agency.

"The industry wrote the rules that permitted them to behave so recklessly. They captured the agencies, which took the cops off the beat. They funneled enormous resources into the political process to make sure there wouldn't be any new cops.

"Then they made hundreds of billions of dollars by selling deceptive products. The sale and resale of those deceptive products crashed the economy. The industry then demanded government bailouts and guarantees," she said.

"Right now we're writing the final chapter in this story. It will show whether we're going back to the first move, letting the industry write the rules again, or whether the crisis actually changed something."

Read the original article.

Labels: CFPA, Consumer Financial Protection Agency, Elizabeth Warren, TARP Congressional Oversight Committee

 

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1/19/2010 06:01:00 PM 0 comments

 

Civil Rights Movement for the Middle Class

by Dollars and Sense

A guest post on Naked Capitalism. Hat-tip to Ben C.

A New Civil Rights Movement is Afoot for the Middle Class

By John Bougearel, Director of Futures and Equity Research at Structural Logic.
Tuesday, October 21 2009

The core of America is the middle class. And Harvard Law Professor and chair of the Congressional Oversight Panel COP (the COP is to oversee TARP, the Troubled Assets Relief Program) Elizabeth Warren tells us that the core of America is being carved up, hollowed out. In her words, "I Believe Middle Class is Under Terrific Assault...Middle class became the turkey at the Thanksgiving dinner" of the financial elite. Elizabeth Warren is more than just right.

Call it for what it is. It has more names than Satan. Call it plundering. Call it pillaging. Call it extortion, Call it fraud. Call it racketeering. Call it the financial raping of the middle class. Call it criminal. Consider the following. Middle class never consented to this financial rape. They vehemently protested it when the gov't first proposed a $700 bailout of the financial system called TARP in Septermber 2008. Yet what did Congress and our government do? They went ahead and did it anyway. This boils down to one thing, taxation without representation. Our votes do not matter anymore.

This is happening because the US government is allowing it to happen. It is one thing for the government to raise the social safety nets for the poor, elderly and such. It is entirely another to raise the social safety nets for the financial elitists at taxpayer expense. But that is exactly what the government has done in the past year. They have rescued a financial system at the expense of everyone else. Mythical constructs and messages that financial companies are Too Big to Fail, systemic risk is too great, No More Lehman Brothers have been created by the powers that be. And it is in the name of No More Lehman Brothers and Too Big to Fail that Middle Class America is being carved up and hollowed out.

Appearing in Michael Moore's "Capitalism: A Love Story, Michael Moore asks Elizabeth Warren (regarding the $700 billion dollar taxpayer funded bailout of the financial elite) "Where's are money? And Warren takes a deep breath, looks briefly over her left shoulder (as if she might find it there), and exhales "I don't know."

Washington Post's Lois Romano asked Elizabeth Warren, "Why don't you know?"

WARREN: We don't know where the $700 billion dollars is because the system was initially designed to make sure that we didn't know. When Secretary Paulson first put this money out into the banks, he didn't ask for ‘what are you going to do with it.' He didn't put any restrictions on it. He didn't put any tabs on where it was going to go. In other words, he didn't ask...

US Secretary of the Treasury Hank Paulson did not ask the banks what they were going to do with our taxpayer money. The US treasury, given Congressional blessing, simply gave the banksters hundreds of billions of taxpayer dollars with no questions asked. This is wholesale taxation without representation.

So Romano asks Warren, "Are we, as an [economy] are we better off systemically now? Have we put things in place to prevent this from happening?" Warren replies "This really has me worried." And it should have Warren worried because our Humpty Dumpty financial system had a great fall, and Humpty was put together again by all the King's horses (read the US Treasury and Congress) and all the King's men (read Uncle Sam's taxpayers), Yet, Humpty Dumpty is still the same old fragile egg he was when he sat on a wall right before he had his great fall.

WARREN: A year ago the big concern was systemic risk and how to deal with 'too big to fail' firms...the big are bigger, we wiped out a lot of small folks and there's more concentration" in the banking system.

And it is not just the Humpty Dumpty financial system that is so fragile.

WARREN: The way I see it is that the financial system itself is quite fragile, and that the underlying economy, the real economy, jobs, housing, household wealth, is still in a very perilous state.

So Lois Romano asks Warren, "Are we going to look back in two or three years at this TARP expenditure and say well, it worked."

WARREN: "What is so astonishing about the first expenditures under TARP was that taxpayer dollars were put into financial institutions that were still, um, left all of their shareholders intact, that were still paying dividends, that paid their creditors 100 cents on the dollar. We put taxpayer money in without saying ‘you've got to use up everyone else's money first.' And once that's the case, I don't know how you ever put the genie back in the bottle. I don't know how you ever persuade either a large corporation or the wider marketplace that if you can just get big enough and tie yourself to enough other important people, institutions, that if something goes wrong, the taxpayer will be behind you.

That's a game-changer. That is a whole different approach than any we've ever used before.

ROMANO: What more can we be doing to protect the middle class, to protect what Michael Moore refers to as the American Dream?

WARREN: "You know, the answer is we're in trouble on so many fronts. In the 1950s and the 1960s, coming out of World War II, we said as a government and as a people, 'what can we do to support the middle class?' That's what, FHA was to help people get into homes, right? VA, uh, G.I. loans on education. We looked at policies by whether they strengthened and support the middle class. Somewhere that began to change in the late 1970s and early 1980s, and the middle class instead became like a resource to be pulled from. They became the turkey at the Thanksgiving dinner. Who could carve off a piece, who could get this little piece, who could make a profit from this piece and that piece or squeeze down on the wages? And, the middle class has gotten shakier and shakier, hollowed out.

The consequences of that are far more than economic. The middle class is what makes us who we are. It affects the poor. A strong and vital middle class is a middle class that can offer a helping hand to the poor. A strong and vital middle class is a middle class that has room, is creating new jobs to, basically to suck the poor up out of poverty and into middle class positions. The middle class is what gives us political stability. It's what gives us an America that's all bought in to the whole process. That what we do is not just about a handful of folks at the top who profit from it. We all profit from it. And that's why we work, and that's why we vote, and that's why we accept the outcome of elections, and, that's why we're safe to walk our streets, because we have a middle class for which this ultimately works, this country.

And every time we hollow that out. Every time we take away a little piece of that. We run the risk that some of what we understood as America, some of what we know as America, begins to die.

That's what scares me.

Aaron Task interviewed Elizabeth Warren at The Economist's Oct 15-16 "Buttonwood Gathering" In that interview, Warren says,

The big banks always get what they want. They have all the money, all the lobbyists. And boy is that true on this one. There's just not a lobby on the other side.

This is a moment when all around the country people are saying we've had it about up to here with these large financial institutions that want to write the rule then take our money. I find it astonishing that they have the nerve to show up and say, 'I'm a big financial institution. I took your money. And now I'm going to lobby against anything that might offer some protection to ordinary families in this marketplace.

This might be the time that the rules change.

The Buttonwood Gathering event took place over the weekend following Q3 earnings announcements from the big banks. Because of the taxpayer bailout of these big banks, some of them, namely JPM and GS are now enjoying record profits and will enjoy record bonuses this season. The irony is overwhelming that this is happening in 2009. Because of the failure of the financial system, more than 7 million middle class jobs have been lost, and the US economy is confronting double digit unemployment for the first time since 1982. Without taxpayer dollars, these record profits and record bonuses in 2009 would not even be possible for the big banks. Hell, without taxpayer dollars zombifying them with congressional and White House sanctioning, they'd have gone the way of the dinosaurs, the way of the buggy whips. That is the way history should have gone. But no, that is counterfactual now. There is something very wrong in America, the very way it is being run by government, and run over by the big banks. It is high time for middle class America to push back, precisely because our elected officials have not only failed to do so, but have legislated all of this to make it happen. Our government has become an active agent in the gutting of the middle class.
Commenting on Wall Street' record 2009 bonuses Elizabeth Warren says she is

Wordless, Speechless. I do not understand how financial institutions could think they could take taxpayer money and turn around and act like it's business as usual...I don't understand how they can't see that the world has changed in a fundamental way—it's not business as usual.

Read the rest of the post.

Labels: Elizabeth Warren, financial regulation, John Bougearel, middle class, Naked Capitalism, TARP program

 

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10/21/2009 03:33:00 PM 0 comments

 

Jon Stewart on Goldman Sachs

by Dollars and Sense

I can't figure out how to embed it here, but the folks at Seeking Alpha did--a great segment from Jon Stewart taking on Goldman Sachs, in the vein of Matt Taibbi (whose Rolling Stone article about Goldman Sachs we've reported here). Watch the video here.

Speaking of Matt Taibbi, he was interviewed last week on Here and Now, a program on Boston's WBUR. Right after that was an interview with TARP-watchdog, Harvard Law professor, and bankruptcy expert Elizabeth Warren. Both were great interviews; listen to them here.

Robert Zevin made similar points about Goldman in the talk he wrote for a D&S house party back in May: All that Glitters Is Goldman Sachs.

Labels: Daily Show, Elizabeth Warren, Goldman Sachs, Jon Stewart, Matt Taibbi, Robert Zevin

 

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7/20/2009 07:22:00 AM 0 comments

 

U.S. May Add New Financial Watchdog

by Dollars and Sense

From today's Washington Post; hat-tip to LF:

Consumer Agency Under Consideration

By Zachary A. Goldfarb, Binyamin Appelbaum and David Cho
Washington Post Staff Writers
Wednesday, May 20, 2009

The Obama administration is actively discussing the creation of a regulatory commission that would have broad authority to protect consumers who use financial products as varied as mortgages, credit cards and mutual funds, according to several sources familiar with the matter.

The proposed commission would be one of the administration's most significant steps yet to overhaul the financial regulatory system. It would also be one of its first proposals to address causes of the financial crisis such as predatory mortgage lending.

Plans for a new body remain fluid, but it could be granted broad powers to make sure the terms and marketing of a wide range of loans and other financial products are in the interests of ordinary consumers, sources said.

Sources, who spoke on condition of anonymity because discussions are ongoing, said talks have begun with industry officials, lawmakers and other financial experts about the proposal, which would require legislation. Last night, senior policymakers, including Treasury Secretary Timothy F. Geithner and National Economic Council Director Lawrence H. Summers, were to discuss the idea at a dinner held at the Treasury Department.

Responsibility for regulation of consumer financial products is currently distributed among a patchwork of federal agencies. Some of these regulators regard consumer protection as a low priority. And some financial products are not regulated at all.

The proposal could centralize enforcement of existing laws and create a vehicle for imposing tougher rules.

The idea is likely to face significant opposition from industry groups, which argue that stricter regulation limits the availability of financial products to consumers.

It could also trigger a massive regulatory turf war. Banking regulators and agencies such as the Securities and Exchange Commission, which regulates mutual funds, could stand to lose powers, personnel and funding. Those agencies are likely to argue they are positioned to protect consumers because they oversee the financial firms directly and have experience writing and enforcing rules governing financial products.

The proposal is part of the administration's broader plan to improve financial regulation. Officials have proposed the creation of a systemic risk regulator whose job would be to spot threats to the health of the overall financial system. Officials also have called for tighter regulation of individual financial firms and markets, including new rules governing hedge funds and derivatives.

While those proposals focus on the guts of the financial system, this new plan would concentrate on the front end -- consumers who borrow money to buy homes and products and who invest their money for retirement, college education and savings.

The leading proponent of such a commission is Elizabeth Warren, a Harvard University law professor who now chairs the Congressional Oversight Panel for the government's financial rescue initiative. Her plan is the kernel of the idea the White House is now considering, sources said.

Warren wrote in a 2007 article in the journal Democracy that the government had failed to protect American consumers in their relationships with financial companies.

"It is impossible to buy a toaster that has a one-in-five chance of bursting into flames and burning down your house. But it is possible to refinance an existing home with a mortgage that has the same one-in-five chance of putting the family out on the street," Warren wrote. "Why are consumers safe when they purchase tangible consumer products with cash, but when they sign up for routine financial products like mortgages and credit cards they are left at the mercy of their creditors?"

Warren proposed creating a new commission modeled on the Consumer Product Safety Commission, which protects buyers of products such as bicycles and baby cribs.

Such a commission could be very powerful. A number of sweeping federal laws already offer broad protection to consumers of financial products, but those laws have been lightly enforced in recent years.

The Department of Housing and Urban Development, for example, has clear authority to crack down on companies that charge excessive closing costs on mortgage loans, but repeatedly postponed planned reforms in the face of industry opposition.

Warren's proposal initially found little support in Washington, but the mood has shifted dramatically with the onset of the financial crisis and the election of a Democratic administration.

In March, Sen. Richard J. Durbin (D-Ill.) introduced legislation to create a commission like the one that Warren had described. The legislation is co-sponsored by Sen. Charles E. Schumer (D-N.Y.) and Sen. Edward M. Kennedy (D-Mass.). The White House's support would greatly improve its chances of passing.

In proposing the legislation, the senators said that the commission would be responsible for identifying emerging problems and for educating consumers.

They were also critical of the existing process.

"The Federal Reserve was supposed to do this, but they were asleep at the switch," Schumer said at the time.

Staff writer Neil Irwin contributed to this report.

Read the original article t.

Labels: banking regulation, Elizabeth Warren, financial crisis, financial regulation

 

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5/20/2009 03:58:00 PM 0 comments

 

Elizabeth Warren on TARP on YouTube

by Dollars and Sense

Labels: bailout, Elizabeth Warren, financial crisis, PPiP, TARP program

 

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4/07/2009 02:10:00 PM 0 comments

 

Elizabeth Warren: Sack Bank Execs

by Dollars and Sense

Elizabeth Warren, who has been on top of this crisis since way back, is also calling for shareholders' equity to be wiped out. Too bad she's only the TARP watchdog and not in charge entirely. I like especially where she says she doesn't want to be too hard on Geithner, but essentially calls his approach "preposterous." We wish she'd say what she really thinks!

US watchdog calls for bank executives to be sacked

James Doran | Sunday 5 April 2009

Elizabeth Warren, chief watchdog of America's $700bn (£472bn) bank bailout plan, will this week call for the removal of top executives from Citigroup, AIG and other institutions that have received government funds in a damning report that will question the administration's approach to saving the financial system from collapse.

Warren, a Harvard law professor and chair of the congressional oversight committee monitoring the government's Troubled Asset Relief Program (Tarp), is also set to call for shareholders in those institutions to be "wiped out". "It is crucial for these things to happen," she said. "Japan tried to avoid them and just offered subsidy with little or no consequences for management or equity investors, and this is why Japan suffered a lost decade." She declined to give more detail but confirmed that she would refer to insurance group AIG, which has received $173bn in bailout money, and banking giant Citigroup, which has had $45bn in funds and more than $316bn of loan guarantees.

Warren also believes there are "dangers inherent" in the approach taken by treasury secretary Tim Geithner, who she says has offered "open-ended subsidies" to some of the world's biggest financial institutions without adequately weighing potential pitfalls. "We want to ensure that the treasury gives the public an alternative approach," she said, adding that she was worried that banks would not recover while they were being fed subsidies. "When are they going to say, enough?" she said.

She said she did not want to be too hard on Geithner but that he must address the issues in the report. "The very notion that anyone would infuse money into a financially troubled entity without demanding changes in management is preposterous."

The report will also look at how earlier crises were overcome - the Swedish and Japanese problems of the 1990s, the US savings and loan crisis of the 1980s and the 30s Depression. "Three things had to happen," Warren said. "Firstly, the banks must have confidence that the valuation of the troubled assets in question is accurate; then the management of the institutions receiving subsidies from the government must be replaced; and thirdly, the equity investors are always wiped out."

Labels: bailout, Elizabeth Warren, financial crisis, TARP program, Timothy Geithner

 

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4/06/2009 02:41:00 PM 0 comments

 

More Criticism of TARP (WSJ)

by Dollars and Sense

From today's WSJ:

Panel Steps Up Criticism of Treasury Over TARP

By MICHAEL R. CRITTENDEN | January 9, 2009

WASHINGTON -- The U.S. Treasury has failed to reveal its strategy for stabilizing the financial system, not answered questions asked by a government watchdog, and has done nothing to help struggling homeowners, a report being released Friday charges.

In the most scathing criticism yet of Treasury's implementation of the $700 billion financial-rescue package, a draft report being issued by the five-member congressional oversight panel said there appear to be "significant gaps" in Treasury's ability to track hundreds of billions of dollars of taxpayer money.

"The panel's initial concerns about the [Troubled Asset Relief Program] have only grown, exacerbated by the shifting explanations of its purposes and the tools used by Treasury," said the draft report, which found that the department has "not yet explained its strategy" for stabilizing the financial markets.

The report faults Treasury on a variety of fronts: having no ability to ensure banks lend the money they have received from the government; having no standards for measuring the success of the program; and for ignoring or offering incomplete answers to panel questions.

The bipartisan panel, headed by Harvard Law School professor Elizabeth Warren, reserved its most strident criticism for Treasury's approach to dealing with the foreclosure crisis at the root of the economic turmoil. The draft report noted that Treasury hasn't used any of TARP's $700 billion to help borrowers refinance or deal with mortgages that are worth more than the market value of the homes they are tied to.

"Treasury needs to be clear as to what, if anything, it has done, and if it insists on taking credit for private sector efforts, it must explain what 'help' means," the draft report said.

Read the rest of the article.

Labels: bailout, Elizabeth Warren, financial crisis, TARP program, Treasury Department

 

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1/09/2009 09:37:00 AM 0 comments

 

Where Have All the Billions Gone?

by Dollars and Sense

From the Inter-Press Service:

A new U.S. investigative panel is demanding answers from the U.S. Treasury about how the agency has spent money from the 700-billion-dollar bailout fund.

The Congressional Oversight Panel, a four-person board authorized by Congress and led by consumer advocate Elizabeth Warren of Harvard Law School, is charged with finding out what Treasury has done with the billions it has already spent.

"We are here to ask the questions that we believe all Americans have a right to ask: who got the money, what have they done with it, how has it helped the country and how has it helped ordinary people?" the panel says in its first report, which lays out its work.

The panel has begun gathering documents from Treasury and also is holding a series of public meetings across the U.S., to hear the public's concerns about the bailout and the economy. The panel expects to have some answers for Congress and the public by Jan. 9, when it will issue a report on its website, cop.senate.gov.

"We will be running very hard over the next 40 days," Warren told members of Congress recently. Also on the panel are Rep. Jeb Hensarling, a Republican from Texas; Richard Neiman, Superintendent of Banks in New York; and Damon Silvers, a lawyer with AFL-CIO.

"The recession has visited every household in the country. More than 100,000 families last month headed into bankruptcy courts. Americans are watching Washington's every move with great concern," Warren said.

In a desperate attempt to ease lending, the Federal Reserve Tuesday dropped the federal funds interest rate to between 0 and .25 percent, the lowest in decades.

The Warren panel lacks subpoena power but will work together with Special Inspector General Neil M. Barofsky, who will wield significant legal power, and the General Accounting Office, in auditing and overseeing the funds.

The rest of the article is here.

Labels: bailout, Elizabeth Warren, financial crisis, TARP program, Treasury Department

 

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12/18/2008 09:45:00 PM 0 comments

 

The Squeezing of the Middle Class

by Dollars and Sense

Harvard Law School professor Elizabeth Warren discusses the economic pressures confronting the two-income middle-class family as it struggles to pay mortgages, health care, and education costs. Warren offers surprising answers to "Who goes bankrupt and why?" and explores the role of banks and credit card companies in tightening the squeeze on the average American family.

This clip, from University of California TV's public affairs program "Conversations with History," is an hour long, but well worth watching.

Labels: bankruptcy, Elizabeth Warren, income inequality, middle class

 

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3/03/2008 07:08:00 PM 0 comments