Elizabeth Warren on Donald Trump and TPP

The darling of the progressives talks financial reform (oh, and the Wonder Twins).

The following is a condensed and edited interview with Elizabeth Warren, U.S. senator, Massachusetts.

Is there some part of you that’s thrilled Donald Trump is calling to reimpose the Glass-Steagall Act and force a split between commercial and investment banks?
I am delighted to see people of all political views engage on the Glass-Steagall issue. I think most Americans get this one: that there’s plain old basic banking, checking, savings accounts, and then there’s more speculative, high-risk banking. And those two should not be joined together. That’s what Glass-Steagall is principally about, and that’s why I think we’re seeing so much support for it all around the country.

Are you surprised Trump is pushing it? He doesn’t strike me as someone who’s given deep thought to financial reform.
I’m not sure Donald Trump gives deep thought to much of anything. But on financial reform, it’s really hard to miss the Glass-Steagall issue. I get up and talk to people who are not very politically connected, and I say “Glass-Steagall” and get a big cheer. I think that because it’s not a distant, technical issue, it’s something that people can feel and understand.

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Finance serves two functions: basic banking, moving around your money through checking accounts. And that needs to be rock-solid pure. That’s why banks get a monopoly to do that and why there’s FDIC insurance. In effect, banks get to do that in return for modest but steady profits. This whole business around using some of those funds, backstopped by an FDIC guarantee, to get out there and engage in speculative financial transactions seems fundamentally wrong to most people. I think that’s why it’s an idea whose time has come again. John McCain and I have submitted a Glass-Steagall bill.

And now you’ve got Trump in your corner.
We’ve got Trump and the whole Republican platform! As well as the Democratic platform.

Given that the financial industry has given Hillary $41 million this election vs. $109,000 for Trump, do you think banks will exert renewed pressure within the Democratic Party?
I don’t see it as a swing back to Democrats so much as I see it as supporting sanity. The financial-services people, as much as many of them would like to see more deregulation, are also deeply frightened by the prospect of a Trump presidency. Nuclear war is bad for business.

How would you grade Obama’s presidency on reining in Wall Street, financial reform, and toughening enforcement of existing regulatory laws?
I always start with an A+ for how Obama fought for a Consumer Financial Protection Bureau when a lot of his advisers wanted to throw it under the bus. That little agency has now returned more than $11 billion directly to families who were cheated and handles nearly a million complaints and has begun to level the consumer credit markets so that families have a fighting chance to buy financial products without getting ripped off. But there have been disappointments.

What would those be?
Mary Jo White and the SEC. They have failed to prosecute wrongdoers. Failed to put tough regulation in place. Failed to take up changes that they have the authority to make and that would restore more confidence in the fairness of operations on Wall Street. That really hurts.

Is there a role for bankers in a Democratic administration?
Yes. There can be, so long as they have demonstrated independence and a willingness to act on behalf of the public. I want to see people who understand what’s not working in America and feel a real sense of urgency to make change.

Right now this economy is working extraordinarily well for those at the top, but not much for anyone else. The people who get appointed to the top posts need to be committed to making that change. And if they have Wall Street experience and that helps them do it better, that’s great. But if their view of the world starts and stops in Lower Manhattan, that’s not going to work at all.

One issue that Democrats haven’t resolved is TPP. Is the Trans-Pacific Partnership dead?
TPP? I thought it was looking pretty dead. I didn’t feel a pulse.

I know you have grandchildren. I don’t know if they watch Saturday morning cartoons. But a banker I spoke to at the Democratic convention said he worried you and Bernie Sanders would become the liberal Wonder Twins if Democrats take over the Senate. How will you and Bernie work together next year?
We will touch our rings together and use the lightning bolts to energize all of our colleagues.

You do watch cartoons!
You got it.

You’ve become an outspoken supporter of Hillary Clinton. Do you consider part of your job going forward is to keep pressuring her to resist falling under the sway of folks like Larry Summers, Robert Rubin, and other Wall Street Democrats who will have a voice in a future Clinton administration?

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