A Fighting Chance. BY ELIZABETH WARREN. Henry Holt, 2014, 384 pp. $28.00.

Talk of the Republican Party’s internal divisions has become a staple of the American news diet. Battles between the conservative establishment and the Tea Party, over matters ranging from foreign policy to immigration, have played out on cable news channels like movie-house serials. Yet no such internal malady seems to be afflicting the Democrats. That’s not because things are going so swimmingly on the left. After all, the median American household income -- the amount earned by the very people the Democrats claim to champion -- totaled just over $51,371 in 2012, a staggering 6.6 percent decline since 2000. The Democrats want to deliver more for the middle class, but after more than five years under President Barack Obama, they haven’t.

Luckily for the Democrats, they have reactionary Republicans to blame for their inability to make headway on their top priorities, from creating an infrastructure bank to enacting a carbon tax to raising the minimum wage. But what if the Democrats didn’t have Republican obstructionism to use as an excuse? Imagine if every jurisdiction that could possibly elect a Democrat did so. The party would have 68 senators (as many as President Lyndon Johnson had in 1965) and would hold a veto-proof majority in the House of Representatives. What would the party then pass into law? It would have to prioritize, since the public would tolerate only so much spending on government programs. Faced with such restrictions, the party’s internal fissures -- which the Democrats have temporarily patched up to fight the Republicans -- would reopen.

Such divides among Democrats are generally not matters of deep ideological conviction, as they often are on the Republican side. There is, for example, no Democratic version of Rand Paul, the Republican senator from Kentucky, steering the party toward exotic ideological shores. The Democrats already underwent their own internal feud of the sort that is currently consuming the GOP, during the presidency of Bill Clinton in the 1990s. They emerged from that experience with a kind of wobbly consensus: that given the raging culture wars, pivoting back toward the center on certain hot-button issues -- adding the word “rare” to the standard Democratic rhetoric on abortion and promoting welfare reform, for example -- could be useful.

Then, President George W. Bush nudged the Democrats left again. Meanwhile, the gradual leftward movement of U.S. public opinion, compounded by broader demographic changes, permitted Democrats to take more openly liberal positions on a few controversial issues, such as same-sex marriage and immigration. That landed the Democratic Party of today slightly to the left of where it was under Clinton.

But the party’s approach has remained largely Clintonian when it comes to what matters most: the economy. Obama, in fact, has not departed from Clintonism on the economic front in any significant way. He appointed two former Clinton administration officials to key posts: Lawrence Summers, as director of the National Economic Council, and Timothy Geithner, as treasury secretary. And he settled for what many liberals saw as a measly $800 billion stimulus, nearly 40 percent of which took the form of tax cuts. On some questions, Obama has even tacked slightly to Clinton’s right. In 1993, for example, Clinton raised taxes on annual incomes above $115,000 (around $189,000 in today’s dollars). Obama drew his line at $250,000 while campaigning, but in the deal he struck with Republicans to avoid a U.S. government default in 2012, he ended up settling for $450,000. The progressives who had lost the economic argument within the Democratic Party during the 1990s drew the short stick yet again.

Obama’s right turn was likely a product of simple political fear. Most Democrats are still afraid to openly advocate raising taxes, and that is an understandable reflex. Yet in poll after poll, majorities have expressed support for typical Democratic policy goals even if they would result in higher taxes -- or, in the case of policies to combat climate change, higher utility bills. In a September 2012 poll commissioned by the National Academy of Social Insurance, a solid majority of respondents even said they supported raising the federal payroll tax -- on themselves -- to avoid cutting Social Security benefits. But Democratic congressional candidates, incumbents and newcomers alike, are too concerned about the flood of conservative attack ads that a pro-tax position would invite.

This is the source of the real fissure that divides Democrats today: the split between the party’s rank and file and its donor and policymaking elites over economic issues. As polls suggest, ordinary Democrats overwhelmingly support paying higher taxes to advance progressive policies. But the elites regard such a posture as too left wing. Until recently, the Democratic masses were starved for a spokesperson, a leader unafraid to challenge elite assumptions. And in Massachusetts Senator Elizabeth Warren, they have found one.

HOME EC

Warren has rocketed to stardom because she can articulate in a few short sentences what millions of American liberals feel. Warren also speaks to some significant number of others who wonder why they struggle to pay their bills while the country’s wealthiest one percent search for the perfect Balinese sea salt. That frustration forms the subtext for Warren’s most famous lines, some of which she delivered to a living room full of supporters in 2011:

"There is nobody in this country who got rich on his own. Nobody. You built a factory out there? Good for you. But I want to be clear. You moved your goods to market on the roads the rest of us paid for. You hired workers the rest of us paid to educate. You were safe in your factory because of police forces and fire forces that the rest of us paid for. . . . Now look, you built a factory and it turned into something terrific, or a great idea? God bless! Keep a big hunk of it. But part of the underlying social contract is you take a hunk of that and pay forward for the next kid who comes along."

Warren’s knack for populist rhetoric is a product of her upbringing. What comes across most clearly in her new memoir, A Fighting Chance, is how closely Warren’s policy positions track with her biography. Born in Oklahoma City, Betsy Herring was a “late-in-life surprise” to a working-class family with three boys. Her mother just wanted her awkward girl to find a husband. As for her father, after leaving a job repairing cars, he drifted from one luckless circumstance to another, never saying very much as he moved the family from one small rental house to the next. Warren’s father did, however, pipe up at one crucial moment in his daughter’s life, when Betsy was in high school. One night, the girl cautiously broached the topic of college at the dinner table, only to have her mother insist that the family couldn’t afford tuition. Her father, however, interjected: “Let her try, Polly.” Warren ended up getting a full ride to George Washington University.

Instead of ascending to the ranks of the ruling elite, however, Warren left college in 1968 after just two years, to marry her high school boyfriend, Jim Warren -- whom she divorced ten years later but whose surname she still carries. Given the tumultuous events of the late 1960s, one of the book’s biggest gaps is its lack of discussion of how Warren engaged with the world during those formative years. Readers never find out whether she protested against the Vietnam War, cried over Robert Kennedy’s assassination, or listened endlessly to the Joni Mitchell album Blue. Instead, they learn a lot about Warren’s domestic life and how she came to develop a passion for the issues that motivate her today: namely, what one might call household economics, with particular attention to bankruptcy, and the travails of the middle class.

After Warren gave birth to her first child, Amelia, she started law school at Rutgers. Her mother fretted that she was becoming “one of those crazy women’s libbers.” After earning her law degree, Warren wrote to the University of Houston Law Center blind; there turned out to be a job opening. Jim arranged a transfer to Houston, and the couple moved.

In contrast to many political aspirants who emerge from the legal world, including Obama, Warren was not taken with constitutional law and other abstract matters. Instead, this daughter of near poverty “headed straight for the money courses” because she “loved the idea of mastery over money.” Her fascination with money led to years of groundbreaking research on bankruptcy that challenged several old-school assumptions about who declares bankruptcy and why, and it won her the recognition that led to tenure at the University of Pennsylvania Law School and Harvard Law School -- and, eventually, to the government appointments in Washington that first gained her national prominence.

CHANGE GAME

A Fighting Chance is organized into six long chapters. The last four are the most relevant to the typical reader: they dwell on Warren’s experience overseeing the Troubled Asset Relief Program (TARP), through which the U.S. government unburdened the country’s largest banks of their toxic assets, in 2008–10; the genesis of the Consumer Financial Protection Bureau (CFPB), a government agency that Warren first promoted in 2007 and helped launch in 2010; and her Senate race. Here, Warren gets to the meat of her story and to the kind of dishy details required of any proper (and marketable) political memoir. Warren hasn’t included such anecdotes, however, simply to boost book sales. Her narrative has an obvious political point: to distinguish her from the party establishment.

She recalls, for example, that Summers invited her to dinner soon after she arrived in Washington, in April 2009. She appreciated his directness, she says -- to a point. Toward the evening’s end, with the table “strewn with bits of food and spilled sauces,” Summers offered an explanation of how Washington worked. You can be an insider or an outsider, he told Warren. Outsiders could say whatever they pleased, but insiders wouldn’t take them seriously. Insiders, on the other hand, got access -- provided they didn’t criticize their fellow insiders. “I had been warned,” Warren writes.

Journalists have long painted Geithner as Warren’s nemesis while she was overseeing TARP, and she does little in this book to alter that perception. She clearly saw Geithner as too secretive and too tilted toward the banks. She was dismayed by the gap between the energy the Treasury Department devoted to saving the banks and its seeming nonchalance when it came to helping ordinary people on the verge of losing their homes to those very same banks. “After the rush-rush-rush to bail out the big banks with giant buckets of money,” Warren writes, Geithner’s response to the housing crisis “seemed designed to deliver foreclosure relief with all the urgency of putting out a forest fire with an eyedropper.”

But Warren also finds cause for optimism in the Washington of which she is now a part, and her account of the creation of the CFPB provides evidence that a controversial bill can still become law. She recounts meeting with Ted Kennedy, the late Democratic senator from Massachusetts (whose seat Warren now occupies), who immediately rounded up several colleagues to announce their support for the idea at a press conference. (Her typically goofy, earnest rendering of her reaction: “I was goose-bump excited. Wow!”) Afterward, she went to see Representative Barney Frank, also a Democrat, in his disorderly apartment in Newton, Massachusetts, who explained to her all the political reasons why Congress wouldn’t authorize the CFPB but then agreed to support her -- and ultimately championed the cause with his colleagues.

In 2010, after Congress passed the Dodd-Frank Wall Street Reform and Consumer Protection Act, which created the CFPB, Obama invited Warren to the White House. As the two of them sat outside in the sweltering September heat, Obama told her she could help set up the bureau, reporting to Geithner. But he gave her no guarantees about “what my specific role would be or how long I’d be around to do it,” she explains. Warren, rejecting the prospect of insider status without actual influence, promptly turned down the offer:

"We pushed back and forth for an hour. Twice his assistant came out to remind him about his next meeting.

Finally he said: 'You’re jamming me, Elizabeth.' He urged me not to overplay my hand.

Got it.

Our conversation was going nowhere -- this just wasn’t going to work. Then he said: 'Sometimes you have to trust the president. Let me work this out.' He pronounced each word separately: 'Let -- me -- work -- this -- out.' ”

Warren did end up effectively running the CFPB on an interim basis. But Obama and Warren both knew that she would never win Senate confirmation to become its permanent head. Ultimately, she served as a handy bargaining chip: Obama agreed not to name her, and Republicans agreed not to filibuster the candidate he did name, Richard Cordray, a former attorney general of Ohio.

Being spurned in this way by the Washington establishment only helped transform Warren into an object of liberal adulation. When discussion in Massachusetts turned to finding someone to unseat then Republican Senator Scott Brown, despised by the left because he was occupying Kennedy’s old seat, Warren was a natural choice. The campaign was rocky for a while -- and was almost knocked off course by allegations that Warren had exaggerated the extent of her Native American heritage while applying for jobs. But the race was a perfect setup for Warren. Brown was one of Wall Street’s favorite senators, which gave Warren ample opportunity to draw a stark contrast between them. The polls were neck and neck for most of the race. Yet in the end, with turnout at 73 percent, Warren won by nearly eight points.

STAGE LEFT

As a senator, Warren has done exactly what she advertised: she focuses on those households making $51,371 or less. And since the Democrats’ donor class remains wary of her, she hasn’t sought its sign-off on her efforts to increase funding for science research or to require banks to provide fairer student loans.

Talk of her becoming president will probably remain just talk: Warren is 65 years old and has suggested that she won’t run if Hillary Clinton does. Since a Clinton run seems likely, it may never be in the cards for Warren to have a shot at the presidency. But her gravitational pull within the party will remain strong, and her influence on Clinton could be immense. Warren commands such a loyal following that she doesn’t even need to be a candidate to nudge Clinton to the left. Many journalists already call the more populist faction of the Democratic Party “the Warren wing” -- such is the level of authority she’s attained in just a few short years. Anything candidate Clinton proposes that falls under the general category of family economics will need to get a thumbs up from Warren. And any hint of Warren’s disapproval could cause Clinton considerable grief by attracting the suspicion of the party’s liberals. But Warren could also be a great asset: Clinton would have no better advocate with the progressive crowd than Warren.

Whatever happens in the realm of presidential campaigns, though, the Democrats’ commitment to fiscal centrism is already slipping. The party won’t likely make a clean break, however -- more of an incremental pulling away. The Democratic Party remains large and ideologically diverse, and many of its members don’t necessarily identify with such liberals as Warren or the Ohio senator Sherrod Brown. But even a gradual shift could wind up establishing a line separating before and after similar to the one that exists, at least in Republican minds, between the pre-Reagan and post-Reagan eras. Warren could play a central role in determining if and when a new era of Democratic politics emerges, and she could even lend it her name.

More broadly, how will the divide between the party’s rank-and-file progressives and its more pro-business, centrist establishment play out? That will depend to a considerable extent on what happens in the 2016 election. If Clinton wins the White House, she will probably be able to maintain a rough consensus by shifting a few ticks to the left on some household economic matters -- backing a modest program for paid family leave, say -- while still trying to make sure that Wall Street knows she’s no lefty. Clinton understands that the liberal wing is now more powerful than it was in 1992, and, within limits, she would respond to their demands accordingly.

If a Republican wins, however, then the two Democratic camps will likely revert to the kinds of recriminatory debates that they carried out during the Reagan era and after the 2000 election. And in both of those cases, the centrists basically won.

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