Consumer advocate Elizabeth Warren, speaking at Berkeley Thursday evening, diverged from her “standard” speech — on the worsening financial straits of the U.S. middle class and “tricks” hidden in the fine print of consumer-credit contracts — to talk about beginnings: “what it means to build a new agency in a new world where information travels at the speed of light.”
The federal agency in question, of course, is the Consumer Financial Protection Bureau, which Warren, as special adviser to the President, is charged with helping to found in the aftermath of the 2008 financial crisis.
A “serious, tough” new consumer agency “won’t fix everything,” the Harvard law professor told a large crowd gathered in Pauley Ballroom for the 14th annual Mario Savio Memorial Lecture. But creating an organization “devoted solely to the economic strength of American families,” she said, “gives us an opportunity to plug a very big hole in the bottom of the economic boat.”
In the early days of the republic, the New England town hall worked and “made sense in a world where commerce was largely local,” Warren said. Federal watchdog agencies like the Food & Drug Administration and the Environmental Protection Agency served in the 20th century as commerce became national, not local. But such agencies, today, can feel distant and faceless to the citizenry they were designed to protect. With new technological tools, “we can do better,” she asserted.
Warren spent part of the week in Silicon Valley gathering ideas for the fledging bureau, and at the Savio Lecture she suggested ways “an agency designed for the 21st century” could leverage technology on behalf of U.S. consumers interacting with a powerful financial-services industry.
It might, for instance, use information technology to solicit people’s experiences with credit-card companies or mortgage brokers. Consumers could scan new credit-card offers — virtually undecipherable to the layperson, she said — and upload them to a website, where they could be analyzed and evaluated. And the agency could collect and efficiently analyze data from varied sources and share that information with the public.
“This agency can succeed. More importantly, it must succeed, because we are running out of time,” she warned. “For more than a generation we have witnessed a steady deterioration in the economic security of middle class American” — who are not readily bouncing back from this recession “because this time they had no parachute when they were pushed off the cliff.”
“There are those who would like to see this agency fail for political reasons, and those who would like to see us fail for economic reasons,” Warren said, when asked about powerful forces that oppose the new watchdog and her role in its formation. “I’m guessing they have found each other. But that doesn’t change a single thing I do tomorrow.”
Warren said that after leaving Berkeley, she planned to stop in Los Angeles to meet a brand new grandson, born earlier in the day. Then “I’m going to get on an airplane, go back to Washington, and do what I can to help give birth to a new agency.”