Just as Leonard Horner was “persecuted and maligned by the manufacturers in every conceivable manner” in his day, so is Elizabeth Warren being relentlessly attacked by bankers and their Republican representatives in ours.
Horner was the head of factory inspection, who “carried on a life-long contest, not only with the embittered manufacturers, but also with the Cabinet, to whom the number of votes given by the masters in the Lower House, was a matter of far greater importance than the number of hours worked by the ‘hands’ in the mills.” Marx relied on the information supplied by Horner to describe the condition of the English working-class, and lauded him for having “rendered undying service to the English working-class.”
Similarly, Elizabeth Warren, first as the chair the five-member Congressional Oversight Panel created to oversee the implementation of the Emergency Economic Stabilization Act and now as Assistant to the President and Special Advisor to the Secretary of the Treasury on the Consumer Financial Protection Bureau, has been carrying on a contest with embittered bankers and right-wing politicians to “fix broken consumer-credit markets and end guarantees for the big players that threaten our entire economic system” (source).
Just last week, she was attacked by Republican members of the House Financial Services Committee for trying to create easily understood consumer lending terms and stronger enforcement of predatory lending regulations. Her testimony [pdf] couldn’t have been more market friendly:
If there is a lesson from the past five years, it’s this: We all lose when consumers cannot readily determine whether they can afford to pay back their loans, and when lenders sell credit in ways that make it hard to see the risks and costs—in other words, when the system is in some ways fundamentally broken. Personal responsibility is critical, and we all know that plenty of consumers have made purchases or taken on loans and risks that they knew they could not afford. But the CFPB can have a critical role in advancing the interests of borrowers and lenders who want to play by the rules by promoting transparency and stronger competition.
For too long, regulation has been described as undermining the free market. This is wrong. The choice isn’t between regulation and the market or between consumers and lenders. The choice is between a market in which costs are impossible for the average consumer to calculate in advance and nasty surprises are hidden in the fine print, and a market in which prices and risks are clear up front so that products are transparent and apples-to-apples comparisons are possible. Good regulation is not about impeding market forces; it is about channeling those forces to make the market work better. Good regulation is not about retribution designed to make an industry suffer; it is about rooting out deception and promoting transparency so that honest competition actually works. Good regulation supports strong markets and makes strong markets more likely to persist over time. This approach is based on faith in the good sense of American consumers to make the decisions that are best for them—once they have the basic information they need.
Clearly, that’s too much for the banks and the politicians they have in their pockets.
Warren is the twenty-first century equivalent of the factory inspector. Her services to the American working class should never be forgotten.