Elizabeth Warren is getting attention recently for her increasingly strident attacks on Wall Street. Beyond mere rhetoric, this has taken solid form in her opposition to the nomination of Antonio Weiss to be undersecretary for domestic finance at the US Treasury. To understand the significance of this it helps to listen carefully to what Warren has said on the matter:
Senator Warren has been pointedly questioning the Wall Street-centric culture that has existed at Treasury and understands that various insiders find that threatening. She’s encouraged that Antonio Weiss supporters are now acknowledging that Dodd-Frank implementation is central to the role, and she continues to believe his experience is not the right fit…
…”[Weiss’s] supporters say, ‘Come on – he’s a smart investment banker, so of course he is qualified to oversee all the complicated financial work done day in and day out at the Treasury.’ But his defenders haven’t shown that his actual experience prepares him for this job,” Warren said in a speech at the Economic Policy Institute Tuesday.
The Treasury Department has had a Wall Street-centric culture since Alexander Hamilton set it up. It hasn’t really occurred to anyone to seriously try to challenge that culture. It seems a bit like trying to take the space-culture out of NASA. Not too many people understand high finance who don’t work in high finance.
Nonetheless, Senator Warren is trying to establish the principle that Wall Street or investment banking experience is actually disqualifying for a job at Treasury.
To be sure, Antonio Weiss has experience facilitating tax-avoidance mergers, so there is a specific beef here beyond the fact that he’s worked in high finance. But his work record is basically unexceptional for a Treasury nominee. Warren is trying to set down a marker.
And it follows on her successful effort to deny Larry Summers the top job at the Federal Reserve. It’s not that Janet Yellin’s record was pure as driven snow, but Warren was letting people know that she expects a different kind of leadership from our government.
For Bloomberg‘s Robert Schmidt, this was too much. He’s decided that the measure of Warren’s effectiveness is not whether she can rally people to oppose Wall Street capture of our regulatory and policy shops, but whether she can also prevent the people she has denied plum jobs from making any money afterwards in the private sector.
Summers went back to teaching at Harvard University, a job that, unlike the Fed, allows him to serve on Lending Club’s board. As a director, Summers has accumulated a little more than 1 million shares of the company’s stock and options, priced at 70 cents a share, according to SEC filings. Since it began trading last week, the peer-to-peer lender’s stock has risen to $27.90 a share—giving Summers a likely paper profit of roughly $28 million…
…Nevertheless, if Summers is looking for a way to show some gratitude to his former Harvard colleague and home state senator, he could always cut her a check. A recent campaign mailing offers an end-of-the-year deal: a special edition T-shirt for a $25 contribution. It reads on the back, “The Best Senator Money Can’t Buy.”
The idea here is to stick a finger in Senator Warren’s eye and say, “See! All your efforts just made Larry Summers a whole lot richer! Nanny, nanny, poo poo, loser!”
But Senator Warren isn’t trying to bankrupt Antonio Weiss and Larry Summers, so this analysis is just trolling.
[Cross-posted at Booman Tribune]