The big banks are not happy with Elizabeth Warren, and they’re prepared to withhold campaign contributions to the Democratic party if she doesn’t become more Wall Street friendly. Of course, Warren isn’t the only Democrat politician rallying against the financial sector, but she’s quickly become the face of financial reform.
According to Reuters, representatives from Citigroup, JPMorgan, Goldman Sachs, and Bank of America have been meeting to discuss strategies for changing the Democratic Party’s tone. Each bank is reportedly making its own decision, without any plans to coordinate.
Likewise, the idea of withholding campaign contributions to the Democratic Senatorial Campaign Committee (DSCC) did not come up in meetings with all four banks, but in one-on-one conversations between bank representatives. According to the Reuters’ unnamed sources, JPMorgan and Citigroup have already decided to withhold financing.
On the surface, the threat is mostly symbolic. Each bank gives $15,000 to the DSCC, hardly enough to finance a Senate campaign.
Nevertheless, Elizabeth Warren is answering back hard. According to the Boston Globe, she wrote a call to action to her supporters.
“They can threaten or bully or say whatever they want, but we aren’t going to change our game plan. It’s up to us to fight back against a financial system that allows those who broke our economy to emerge from a crisis in record-setting shape while ordinary Americans continue to struggle.”
Warren is going to her supporters, asking for the $30,000 to replace contributions from Citigroup and JPMorgan Chase. The Globe reports that one fundraising plea on Warren’s email list can generate about $100,000.
Elizabeth Warren came to prominence during the height of the financial crisis. She’s earned the banks’ wrath through tirelessly advocating stronger government regulation in the financial sector.
Soon after joining the Senate in 2013, Warren introduced the 21st Century Glass-Steagall Act of 2013, which would reinstate some of the Glass-Steagall Act protections separating depositor accounts from risky investment banking. The act was never enacted, but she did play a large role in establishing the Consumer Financial Protection Bureau after the Dodd-Frank bill was passed.
Likewise, Senator Warren called for “too big to fail” banks to be broken up under the Dodd-Frank financial reform law, specifically naming Citibank.
According to the Huffington Post, Warren also managed to block the appointment of banker Antonio Weiss to a high-level post in the Treasury Department, citing a conflict of interest in regulating his former colleagues.
The banks move comes at a critical time in the Senate. Harry Reid recently announced his retirement. Charles Schumer is expected to replace him, but some have called on Elizabeth Warren to step up. Her aide already put a stop to that, according to the Boston Globe, but having Schumer as the Democratic leader in the Senate might not sit well with Warren.
Forbes referred to Schumer as the “king of cash from the financial sector” for being the recipient of millions of dollars from commercial banks. Despite being an occasional ally of Elizabeth Warren, his leadership combined with Warren’s rabble-rousing might open a split among Senate Democrats.
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