If you write an article identifying a certain politician as the “nightmare” of a likely presidential nominee, you can’t get upset when readers tell you said nightmare stands little chance of snatching away the nomination. And yet I can’t help thinking many pundits missed the point when, in response to my recent story about Elizabeth Warren (“Hillary’s Nightmare”), they ticked off all the reasons Hillary Clinton would crush Warren in a potential primary matchup.
It’s not that I disagree. In the piece, I describe how a Warren-Clinton primary might play out before concluding that “Warren would probably lose.” It’s just that I don’t think this is an especially interesting discussion. Most overwhelming favorites go on to win the race they’re running. The difference is that, in presidential primaries, how the frontrunner wins matters almost as much as whether they do. Do they have to adopt an entirely new political persona (see Romney, Mitt)? Do they have to make big ideological or policy concessions? Do they have to replace one set of advisers with another? Do they have to break with a key constituency or embrace an entirely new one? This “how” tells us a lot about the party and where it’s headed. And it’s here where Warren’s influence is potentially enormous.
The most obvious reason Warren poses a threat is that the Democratic Party has changed quite a bit since the last time Hillary ran for president. I won’t go through all the polling data I cite in my piece, but even a quick glance at the numbers tells you Democratic voters today are much more in-step with Warren ideologically (and much less in step Clinton-era New Democrats) than they were back then. Recent polling by Pew shows Democrats becoming more preoccupied with inequality and more sympathetic to regulation since 2007. According to Gallup, the percentage of Democrats expressing dissatisfaction with “the size and influence of major corporations” rose from 51 to 79 between 2001 and 2011.1 And Democrats have become especially hostile to banks. Gallup finds that the percentage of Democrats with negative views toward banks has increased from 23 to 47 since 2007; the percentage with positive views has dropped from 51 to 31.
Having said that, it’s one thing for Democratic voters to evolve ideologically; it’s another for this to have electoral consequences. There are lots of steps that must come in between. For example, even if Democrats feel strongly about curtailing the power of the financial sector—Warren’s big hobbyhorse—that doesn’t mean they’ll cast their primary votes on the basis of that issue, as Ezra Klein and Ross Douthat point out. And even if Democrats do feel strongly enough to vote on this issue, there’s no reason Hillary can’t accommodate their concerns, at least not in principle. She can read polls as well as anyone, probably better.
In practice, though, I think this ideological shift is deeply problematic for Clinton. Klein touches on the reason why when he writes that Democrats’ views on corporations and banks may serve as a proxy for something bigger:
The danger for Clinton is if Warren is able to persuade Democrats that cracking down on Wall Street reform is the key to helping the middle class or—perhaps more plausibly—opposing inequality. On a policy level, that's a harder case to make. But on an emotional, who's-on-your-side level, it might work.
I’d put it slightly differently. I don’t think Democrats are so exercised about big corporations and big banks that they’re willing to turn on a deeply respected figure simply to rein them in. Corporate and financial-sector power is, after all, a rather abstract issue. It doesn’t touch people’s daily lives in ways they can easily discern. What makes it concrete—and rather explosive at that—is a political system that heaps all sorts of economic advantages on big companies and big banks while at the same time tolerating economic stagnation (or worse, mass suffering) among middle-class and working-class people. It’s this juxtaposition that’s left voters with a deep sense of grievance, which Warren has tapped since emerging on the national scene.
Consider the kinds of questions Warren favored when she was head of the Congressional Oversight Panel, the body tasked with keeping an eye on the bank bailout. “AIG received $70 billion in TARP money, $100 billion in loans from the Fed,” Warren prompted Tim Geithner at a hearing September, 2009 hearing. “Do you know where the money went?” This line of inquiry drove Treasury officials to distraction.2 But whatever you think of the question, it reflected a inescapable political reality. The average person in late 2008 and early 2009 saw trillions of dollars go out the door of the federal government, while at the same time observing that unemployment had spiked to its highest level in 30 years and foreclosures had reached epidemic proportions. What they wanted to know at that moment was precisely what Warren was asking—what the hell have you been doing with this money, because I know you didn’t spend helping people like me.
That sense of outrage exists to this day. In some sense it’s more acute. Voters have noticed the speed with which Corporate America and big banks have recovered from the crisis. They’ve also noticed that unemployment remains unusually high and that wages have stagnated (actually dropped) since the recession. No wonder that, when Pew recently asked voters if they agreed with the statement that “the rich just get richer while the poor get poorer,” 92 percent of Democrats said they did, the highest since Pew began asking the question in 1987.3
Since entering the Senate, Warren has only gotten better at homing in on the disparity between how we treat the rich and powerful and how we treat the middle class since. Take student lending, a longtime Warren obsession. In September, she sent a letter to the Departments of Education and Treasury about Sallie Mae’s extensive record of abusive lending practices. Warren asked why, given the company’s serial misbehavior, the federal government continued to shower it with cushy contracts and subsidized loans. “While the government has been quite tolerant of Sallie Mae's failings and helped Sallie Mae maintain its profitability, it is not nearly as generous when it comes to student borrowers,” she wrote, noting the stiff consequences for students who default. The letter kicked up so much attention that the CEO of Sallie Mae found himself fending off questions about it from Wall Street analysts on an earnings call.
Perhaps most disconcertingly for Hillary, she is much more vulnerable to these sorts of attacks than the average business-friendly Democrat. For her, they’re not just policy problems; they raise deeper questions of character. In the same way that Hillary’s Iraq vote was damning in the eyes of many Democrats because it seemed to epitomize unprincipled, Clinton-esque positioning, Hillary’s reluctance to get tough with Wall Street could dredge up bad memories about Clinton-world’s uncomfortably close relationships with a variety of wealthy donors. As Jonathan Chait has pointed out, it’s Hillary’s unique misfortune that, as in 2008, one of the most emotional issues in today’s Democratic Party happens to overlap with one of her personal liabilities.
Of course, all this is moot if Hillary decides to coopt a large chunk of Warren’s agenda between now and 2016. But I’m deeply skeptical that she can. It’s not just that the Clintons have raised tens of millions from Wall Street over the years, and that Hillary would presumably rely on the financial sector to fund her next campaign. It’s that the Clintons have consistently (though obviously not exclusively) leaned on finance-centric Democrats as a source of economic advice and basic camaraderie. As one former Clinton White House aide told me for my piece, “Many of her best friends, her intellectual brain trust [on economics], all come out of that world … it will be hard, really wrenching for her to be that populist on [financial] issues.”
A handful of commentators have suggested that Hillary could solve this problem by playing a clever game, striking a more populist stance toward Wall Street while slyly winking at her donors, who are pragmatic enough to understand that Hillary is simply doing what she has to do to head off a rival they fear and loathe. As Douthat writes:
I don’t see Hillary having any trouble pivoting leftward a bit on financial issues if a challenger seemed to be getting any traction. (Her donors would forgive her such a pivot because, well, they would assume that it was just empty pandering—in the same way that plenty of big donors managed to ignore Obama’s NAFTA posturing in 2008 or Mitt Romney’s China-bashing in 2012.)
If this is in fact the plan, then I fear Hillary is in much bigger trouble than even I realized. Take the Romney example. Yes, Romney engaged in a fair amount of China-bashing during the 2012 campaign. And yes, his donors didn’t give him any guff about it. But did anyone—literally anyone (raise your hand please)—believe he’d actually toe a populist line were he elected president? If they did, they had a funny way of showing it. According to the exit polls, 53 percent of voters thought Romney’s policies would favor the rich, versus only 34 percent who thought they’d favor the middle class. (By contrast, the same numbers for Obama were 10 percent for the rich and 44 percent for the middle class.)
The lesson here is that pandering doesn’t work when it’s at odds with what most people already believe about a candidate. And what people know about Hillary is that she and her husband have been close to the financial sector over the years, and that the relationship persists to this day. (Witness the $400,000 she just recently banked from two speaking appearances underwritten by Goldman Sachs.)
Worse, it’s almost impossible to imagine this clever wink-and-nod strategy not becoming a story unto itself. In fact, it already has. The day after my piece ran, Politico followed up with a story entitled, “Wall Street’s nightmare: President Elizabeth Warren.” The Politico piece noted that, “The fear of a Warren candidacy is likely to drive even more Wall Street money to Clinton’s potential campaign.” This may prove to be a lucrative source of funds. But politically, these stories are disastrous. The only way Hillary is going to persuade voters she’s broken with Wall Street is to provide some credible evidence of a break—for example, reporting low fundraising numbers from the financial sector, ostracizing former members of her husband’s economic team, at the very least provoking loud kvetching from the titans of finance. But this is precisely the kind of break Hillary is highly unlikely to make.
All of that said, maybe Democrats are so devoted to Hillary these days they’ll refuse to even entertain criticism of her, however legitimate the complaints may be, and however unsettling they might prove were the party to openly debate them. Harry Enten of The Guardian wrote over the weekend that Hillary’s poll numbers are so gaudy they make her look less like a mere presidential candidate and more like an incumbent president running for re-election—which is to say, the sort of figure who racks up huge margins within his own party, making him virtually impregnable to an internecine challenge.
The problem is that as much as Hillary may look like an incumbent, she simply isn’t. Unlike an incumbent, Democrats wouldn’t be evicting the President of the United States if they opted for another candidate over Hillary Clinton. That gives them a lot more leeway to embrace someone else, much as they may esteem Hillary.
Far from recalling an incumbent, what Hillary’s numbers evoke to me is a popular First Lady. Indeed, if you look up Clinton’s historic favorability ratings, you see that her numbers over the last few years were exceeded by her previous peak in 1999. According to Gallup, Hillary’s highest approval rating since becoming Secretary of State was 66 percent. She was at 67 percent in 1999, before dropping below 50 percent when she ran for Senate the following year.
Now this is obviously a crude comparison. Hillary has come a long way as a politician and ecumenical leader since serving as First Lady. And these are overall numbers, not Democratic Party numbers, even though the latter are more relevant to what we’re talking about. But the point remains: Hillary at her golden-glowiest, above-the-fray best is simply a different kind of figure than Hillary the brass-tacks politician. There’s no reason to think the poll numbers for the former tell us much about the poll numbers for the latter. And if Elizabeth Warren were to join the 2016 race, it’s the latter figure who she’d be challenging, pretty much by definition.
Noam Scheiber is a senior editor at The New Republic. Follow @noamscheiber.
The general trend continues through the present, but the question changed slightly after 2011.
These officials insisted it was an impossible question to answer since money is fungible—there’s no way to tell if AIG was using government money to pay off the other financial institutions it owed money to, or using its shareholders' money, etc.
Interestingly, the previous high, 90 percent, came during the 1991 recession. The current high of 92 percent came three years after the recession officially ended.