Elizabeth Warren Takes Conciliatory Tone With Bankers
Yesterday evening, Elizabeth Warren, responsible for setting up the Consumer Financial Protection Bureau, spoke at a meeting of the Financial Services Roundtable, a trade association for the country’s biggest banks.
In the past, Warren has lambasted banks for purposefully creating opaque, obscure products to make a buck off of customers. (Her infamous phrase for some financial products? “Tricks and traps.”) But this time, in one of her first official appearances as a member of the administration, she took a conciliatory tone.
She continued to use the folksy cant she has picked up in the last few weeks. “My first public meeting after [my current] appointment was with bankers — bankers from Oklahoma, where I grew up, where my grandmother drove a wagon in the land rush, and where I learned to sing Boomer Sooner before I learned Old MacDonald,” she said to open her remarks. (Did she always talk like this?)
Then, the tone went conciliatory. “We are not working on the theory that all the men and all the women connected with finance, either as workers or investors, are to be regarded as guilty of some undefined crime,” she said, according to prepared remarks. “On the contrary, we hold that business based on good will should be encouraged.”
Warren pressed for a principles-based, rather than rules-based approach — describing questions like “Can a customer easily understand what this product does?” as more important than “Should we ban companies from selling redundant insurance for certain title problems?”
Nevertheless, the old attitude did shine through. “[C]redit agreements have gotten long and complicated. In fact, there’s a new epithet: fine print. I understand that some of you call it ‘mice type.’ Where I come from, nobody calls fine print, hidden fees and surprise penalties ‘negotiated contract terms’ or ‘innovations.’”
She continued: “On a polite day, my brothers in Oklahoma call that kind of stuff ‘garbage.’ They don’t care if it is there because regulators required it, because the companies’ lawyers were trying to ward off lawsuits, or because it was a good place to hide another new fee. They simply see a world in which the financial institutions they do business with are not on their side. Every surprise hidden in the fine print is a bad surprise.
“Instead of seeing banks as their friends — as I did when I put my babysitting money in a savings account at Penn Square National Bank so my brothers didn’t borrow it out of my sock drawer — too many Americans see dealing with banks like handling snakes — do it long enough and you’ll get bit.”
And there it is: conciliatory but wary, soft enough to charm banks and stringent enough to please the progressives that fought to make sure Warren had the role.