A Fighting Chance (23 page)

And that’s how I came to be driving around Newton, Massachusetts, looking for Barney Frank’s apartment, on a Saturday morning in April 2009. The day was lovely, and the road threaded between trees that were just starting to bud. Almost perfect, except that I was lost. (Yes, lost again.) I could see a street sign, but it was nowhere on my printed directions. I didn’t have GPS, so I pulled over and used my own personal help-me-I’m-lost device: I took out my cell phone and called Bruce. I told him the name of the road. He looked at an online map, figured out where I was, and directed me to the congressman’s apartment complex. I parked in an adjacent lot, figuring I was home free.

No such luck.

I saw several modest, two-story brick buildings. They were turned this way and that, with no obvious pattern to the numbering. (Who designs these places?) I was still wandering around when Jim Segel, the congressman’s longtime friend and senior advisor, called out, “Over here!” He laughed as I came up. “This place can be a little confusing.” A little confusing? Yeah, and the Empire State Building was a little tall.

Jim showed me into the congressman’s apartment. It was a small space; on one side of the living area there was a king-size mattress on the floor, complete with a tangle of unmade sheets and blankets. Jim sat down next to a small table in the kitchen part of the room. I said hello to the congressman’s surfer-dude-handsome boyfriend, Jimmy, but before we had a chance to visit, Congressman Frank burst in.

There’s no ignoring Barney Frank, and he was no more relaxed in his kitchen than he was on the floor of the United States Congress. He sat me down with my back wedged up next to the refrigerator, then jumped right in.

In his usual rapid-fire delivery, he said it was clear that families had gotten cheated in the mortgage market, and he liked the idea of the consumer agency to clean things up. (Yes!) But his first obligation was to make sure we could really get something done. Financial reform was already too complicated, and he was worried the consumer agency might have to wait. In the fight for any financial reform, we would be up against an army of lobbyists, and he thought it might make more sense to take them on one issue at a time. If we tried to push through everything at once, we could lose it all. So he would start with the bank regulations that obviously needed fixing, focusing on the rules covering derivatives, capital reserve requirements, and so forth.

The same reasons that made Congressman Frank uneasy about including the consumer agency from the start made me want to move it to the front of the line. I was sure the lobbyists would fight tooth and nail against the new agency, and I worried that if the rest of the reform package made it through first, no one would feel any great urgency about continuing to battle the lobbyists. We had to make this agency a priority. I figured this was our moment: now or never.

Wedged up against Barney Frank’s refrigerator, I wanted to talk about all the problems the new agency could fix and all the families it could help. But Congressman Frank knew all that, and he cared as much about these families as anyone did. Besides, he didn’t disagree about policy—he was arguing over how to get things done in Washington. This was about politics, and he knew a billion times more about that than I did.

So I took a breath and tried a totally different tack. I said I wanted to tell him a story. He was clearly impatient, but he nodded for me to go ahead.

I told him that when I was a kid, I would hear stories about my grandparents’ lives in Oklahoma. In the early 1900s, my grandfather was a carpenter, doing repairs and building small homes and the occasional one-room schoolhouse in Indian Territory. My grandmother raised ten children. My mother was the baby, and she still lived at home when the Great Depression hit. I don’t think my grandparents knew anyone who owned stocks or other investments. For them, the Depression had nothing to do with Wall Street and the stock market crash. It was about local bank failures and families losing their savings and their farms.

My grandmother had never been very political, and she sure didn’t follow high finance. But decades later, she was still repeating her line that she knew two things about Franklin Roosevelt: He made it safe to put money in banks and—she always paused here and smiled—he did a lot of other good things.

And that was my pitch to Congressman Frank. Start with something that people understand, something that solves a problem they can see. Do that, and then they’ll have confidence in the work you do to fix the parts they can’t see. Yes, derivatives and credit default swaps were huge problems. He was totally right about that. But for a lot of people, those were just words that fly by in news reports. On the other hand, a mortgage broker who lies about the terms of a mortgage he sells to a homeowner—that’s something everyone understands. Hidden fees on a credit card bill—that’s a problem millions of people had been living with for a long time. Fine print and confusing legalese—everyone had signed loans that were loaded with it.

Start simple. Fix something people can see.

My whole pitch might have lasted two minutes, tops. Congressman Frank sat still for maybe ten seconds, then said, “I get it. Let’s do it.”

He would push to get the consumer agency into the reform package, right out of the gate. Wowee-zowee! It was a cartwheel moment.

Somewhere in that conversation, we stopped being Congressman Frank and Professor Warren. From that day on, it was Barney and Elizabeth.

Barney was good to his word. He fought like a tiger to keep the consumer agency in the financial reform package. With Barney on board, the agency wouldn’t be left at the station like so much unclaimed baggage. We had a new champion, the best we could ever have hoped for.

The chances that we’d get a consumer agency were skyrocketing. Now, instead of no chance at all, we were up to
almost
no chance at all.

Announcement Day at the White House

April rolled into May and then June. I went on
The Daily Show with Jon Stewart
and questioned Tim Geithner in our first public COP hearing with him. Ted Kennedy called to tell me he was pushing hard to build support for the new agency. “We’re working it,” he said. Classes ended at Harvard, and COP kept churning out reports, month after month.

Early that summer, Bruce and I took off for a family reunion in Oklahoma. By now, all three of my brothers had retired. In a very sad twist of fate, all three were widowers. All three had lost their wives too early, to cancer. Don Reed had been blessed to find a wonderful new partner, so he had remarried, but David and John were alone.

I was eating barbecue and visiting with my nephew Mark when my cell phone buzzed. An official-sounding voice came on the line and said: “The president will be announcing his financial reform package in two days at the White House, and you are invited.”

Holy cow—the White House! A presidential announcement!

I immediately told the whole clan. Even Don Reed and David, both dyed-in-the-wool Republicans, were excited. (Of course John, who was a President Obama man, was even more excited.)

I changed my plane tickets so I could fly straight back to Washington. Then I had a moment of panic. I’d come from Boston to Oklahoma carrying a suitcase with my usual family reunion attire—shorts, T-shirts, swimsuit, and sandals. I couldn’t exactly wear that kind of gear to the White House. Besides, I’d gotten barbecue sauce on my best shorts. I didn’t have time to get to my own closet in Boston, so I had to go on an emergency shopping trip.

My two nieces, Michelle and Melinda, went with me to the mall in northwest Oklahoma City. Time was short, and I ended up grabbing something fast in one of those desperate shopping moves that makes me wonder afterward what on earth I’d been thinking.

Two days later, on June 17, 2009, I was standing in a long line outside the White House gate. It was hot, and I was discovering that the fabric on my new jacket itched like crazy and made a funny
whooshing
sound when I walked. The new shoes made my toes throb. Great start for an afternoon at the White House.

After we were all processed through security, we were herded into a big room inside the White House. People milled around and talked with one another. I spotted a couple of familiar faces from Capitol Hill and a few people I knew from the nonprofits, but I didn’t recognize most of the people in the room.

Finally, we were called into an ornate room that was jammed with tiny folding chairs. The space between the rows made airline seating seem generous. I was in the back of the crowd as we surged into the room, so by the time I made it in, only a few seats were left. I spotted a chair on the aisle, but to sit down, I had to scoot the chair back a little, right into the shins of the man in the row behind. I recognized him: it was Rich Trumka.

Rich and I met for the first time that day. At that time he was the secretary-treasurer of the AFL-CIO, although a few months later he would replace John Sweeney as the new president of the eight-million-member union. Rich had started out in the mines, and he was built like a Mack Truck, solid and radiating a barely contained energy.

As I sat down, I turned around and said with a tentative laugh, “You’re not going to kick the back of my chair, are you, Mr. Trumka?”

Rich leaned forward and said, “Nah. Sit down. I’ve got your back, Elizabeth. I’ll always have your back.”

Before the president came out, copies of a white paper prepared by the Treasury Department were passed around. Various proposals for financial reform had been percolating in Congress for a few months, but everyone was waiting to see what the White House would do. This was the administration’s opening shot in the battle for reform.

Sure, the president had talked about toasters on television, but it worried me that the banking industry had so much access to the White House. I knew that senior White House staffers had been holding meetings with the CEOs and lobbyists from Citibank, JPMorgan, Bank of America, and other giant banks, and I had no clue about what had been promised in those meetings.

The press was reporting that the agency was somewhere on the White House’s wish list, but I needed to see for myself what that really meant. Would the White House propose a strong consumer agency with real teeth? Or would it float the notion of some empty advisory thing or maybe some minor initiative that could easily be bargained away? Would the agency be “another possible idea” in a long string of “possible ideas,” or would it get a “we’ve got to have this” push?

The document being handed out that day was eighty-nine pages long. My hands shook as I opened it. Completely missing the table of contents, I tore through the pages. Financial Services Oversight Council. Capital and Prudential Standards. National Bank Supervisor. I was getting panicky. Was there anything in here about the agency?

Finally, on page fifty-five I found the right section: Protect Consumers and Investors from Financial Abuse. Skimming, I spotted two paragraphs about what had gone wrong—got it, got it—and then I hit the magic sentence: “We propose the creation of a single regulatory agency, a Consumer Financial Protection Agency (CFPA), with the authority and accountability to make sure that consumer protection regulations are written fairly and enforced vigorously.”

Bingo—the White House was in all the way!

At the time, I was too buzzed with excitement to marvel at how truly astonishing this was. I’d heard rumors that some of the president’s top financial advisors were unenthusiastic about the concept for the new agency. Besides, the administration was in the midst of the largest financial crisis in living memory, and the staff had a billion things to worry about and was overwhelmed. So where had the support come from?

Months afterward, I would find out. When push came to shove, the agency had a powerful champion on the inside. As I would later learn, he believed passionately that the White House needed to support a reform measure that would help regular people, and he saw the agency as the best way to do that.

His name was Barack Obama.

Going Door-to-Door

After the White House announced its position on financial reform, it was time for Congress to go all out. Barney Frank took the lead in the House, and later Chris Dodd, a Democrat from Connecticut, picked up the ball for the Senate in his role as chairman of the Senate Banking Committee. Together, they took on the monumental task of designing a bill and getting their colleagues behind it. It was an uphill battle: when the campaign for the reform bill began, we sure as heck didn’t have the votes in the House or the Senate. And the bank lobbyists were fighting full out.

Michael Barr, assistant secretary of the Treasury, and his top deputy, Eric Stein, directed the painstaking work of drafting the administration’s proposed language. Community advocates also stepped up in a big way: in June 2009, a number of nonprofits joined forces and set up Americans for Financial Reform (AFR), an organization whose main mission would be to fight for a range of financial reforms that would benefit regular people. AFR was launched with help from nonprofits like AFL-CIO, Consumer Federation of America, and PIRG, and eventually more than two hundred groups would join the cause.

AFR managed to scrape together some money, and they used it to hire a handful of employees, including Heather Booth as executive director and Lisa Donner as her deputy. Creating a small team to organize the overall campaign for reform was a brilliant move. Instead of each nonprofit putting a little time into fighting for this or that provision, AFR coordinated the efforts of dozens of groups, magnifying the work of each one by helping them speak with a single voice. Heather and Lisa and the rest of their crew put out press releases, coordinated briefings on Capitol Hill, and organized groups of volunteers. The staffers and lobbyists and lawyers for the megabanks outnumbered them by a zillion to one, but the AFR people were there—day in and day out—hammering on the need for financial reform. They worked their hearts out.

I was still pouring much of my time into teaching and COP, but I figured we were approaching the make-or-break moment for financial reform and the consumer agency. I offered to jump in to help however I could, and that summer, Dan Geldon offered to jump in with me. The Roosevelt Institute offered Dan a job to help develop ideas and advocate for financial reform, and Dan said yes. He quit his job at COP. Never mind that this would be his third job in eight months. Dan wasn’t in this to build a résumé that would look good to some future employer. He wanted to make a difference—right now.