How Elizabeth Warren Put Bankruptcy on the Progressive Map

By Roosevelt Institute |

She’s already had a knack for raising the profile of ignored but important issues, and the office of U.S. Senator can act as an even bigger megaphone.

Elizabeth Warren, who yesterday announced her candidacy for the Senate in Massachusetts, is best known as the inventor and rightful director of the Consumer Financial Protection Bureau. In that role, and in appearances on The Daily Show, her disarming charisma — made up of equal parts moral commitment, intellectual firepower, and a sense that she’s listening as intently as she’s talking — became familiar to millions.

But I still think of Warren at least as much for a role she played earlier in the decade: bringing the issue of bankruptcy into the public debate, most notably in the Warren Reports, which she and some of her students and protégés at Harvard Law School set up as a subsection of Josh Marshall’s Talking Points Memo blog in 2005. The Warren Reports set bankruptcy reform, which passed Congress that year, in the context of middle class families’ struggles to stay afloat in the economy. It showed us how bankruptcy — the chance to start over after a financial disaster — is as essential a part of the social safety net as unemployment insurance or savings.

What Warren did with the CFPB — put forward a specific policy idea and watch it pass into law — is rare enough, given the American political system’s resistance to good ideas. But what Warren did with bankruptcy is even more impressive. She took an entire issue that had no political salience whatsoever and helped make it matter. Bankruptcy was a classic example of an issue that had no constituency in the world of narrow interest groups except for the credit card companies and banks, all big political donors, that wanted to make it much harder for people to declare bankruptcy and start over with manageable debts. Unions didn’t think it was important (it would affect their members, but not the unions themselves); anti-poverty groups were more focused on federal programs and most bankruptcies affected the working middle class, not the very poor; health care advocates knew that health crises were a leading cause of bankruptcies, but it was not their issue. A handful of bankruptcy lawyers pushed back, but they were plainly self-interested and no match for the credit card behemoths. Members of Congress, including many Democrats (especially those from states that you might see on the return address of a credit card solicitation), voted to tighten bankruptcy laws year after year before the bill finally passed, and rarely did they hear a protest from a constituent or an activist.

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But Warren, her TPM blog, and her other activism helped put the issue on the radar for the emerging “netroots.” The most useful contribution from the online activists of the netroots has been to break that single-issue interest group model of progressive politics and look more comprehensively at everything that matters for the middle class and working poor in America as a whole. They don’t say, “That’s not my issue” if it’s important. Key netroots blogs of that period, such as Daily Kos and, picked up Warren’s message and began to blast Democrats who had voted for bankruptcy reform, and it was a major issue in Maryland Rep. Donna Edwards’ successful 2008 primary challenge to Rep. Al Wynn. The bill had passed by then, unfortunately, but at last the issue mattered. Reversing the changes to bankruptcy law reform is now a major progressive priority.

I assume that lots of Warren’s friends have asked her why she would want to bother being a senator. Until they become committee chairs after three or four terms, or unless they can wedge themselves into the position where they are the critical 60th or 50th vote on key legislation like Ben Nelson of Nebraska (the most conservative Democrat), each senator has very little clout. Former governors, accustomed to the limitless power of the executive, often chafe at the endless talk and indecision. But a very few Senators are able to have an impact far greater than their institutional clout because they ignore institutional power and treat the Senate as a platform for ideas. That’s what Paul Wellstone did at the peak of his career (although it took him a while to figure it out), or the great liberal figures of the 1980s and earlier, Howard Metzenbaum of Ohio and William Proxmire of Wisconsin. On the right, Jesse Helms did much the same thing. Because any senator can introduce any amendment at any time, and with a subcommittee she can hold hearings on almost anything, she can force debates that the American political process doesn’t want to have. Combine that with a good use of all the external platforms that are available to a person with the words “U.S. Senator” before his or her name, and it can become an enormous megaphone for what Warren did with bankruptcy and the CFPB: putting an issue or an idea on the agenda. And if she’s elected, she might show some of her colleagues that if they want to make a difference, they have to do more than sit around and vote in committee meetings.

Mark Schmitt is a Senior Fellow and Director of the Fellows Program at the Roosevelt Institute.

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