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Are the Big Banks Surrendering on Elizabeth Warren?

[Guest post by Noam Scheiber:]

That's been my expectation all along--for the simple reason that Wall Street opposition to Warren as head of the consumer financial protection agency would only make it politically more attractive (or at least politically necessary) for the White House to nominate her and Senate Democrats (even some Republicans) to support her. It's increasingly clear that Wall Street has made the same calculation.

For weeks now, the big banks and their Washington representatives have been conspicuously silent on Warren despite their well-known distaste for her views on regulation. Now The Washington Post reports that Warren actually met with one of the big-bank lobbying groups last week:

Before the Harvard law professor visited the White House on Thursday to talk with Obama advisers about the consumer bureau job, she spent an hour just down Pennsylvania Avenue at the Financial Services Roundtable, which represents the nation's largest financial firms, said people familiar with the meeting.
Warren and Roundtable President Steve Bartlett spoke at length in his office about the role of the new regulatory agency...
Meeting with an industry trade group isn't out of the ordinary for Warren. ... She has filled her days in the capital meeting with administration officials, reporters, banking regulators, members of Congress and lobbyists representing community banks, credit unions and other financial industries. For instance, in June she dined with Cam Fine, president of the Independent Community Bankers of America, and last month she met in her dingy office near Union Station with Richard Hunt, president of the Consumer Bankers Association.
But until last week, Warren and lobbyists representing the nation's largest banks had largely steered clear of each other.

There are any number of ways to interpret this meeting. But the most obvious is that the inudstry has decided to play the Warren nomination pretty pragmatically--it's assuming that she's likely to be both nominated and confirmed, and has opted to sue for the best peace it can get, or at least not antagonize her beforehand. Put it this way: Given that the big banks are so suspicious of Warren, would Bartlett and the Financial Services Roundtable have agreed to this meeting if they didn't think she was likely to be their regulator in a few months? Maybe, but I doubt it.

P.S. As I said yesterday, I think there will be some industry opposition to Warren--there already has been. And I'd guess the big banks will play some behind-the-scenes role in stirring it. But I expect the formal effort to be limited to small banks and ostensibly Main Street groups like the Chamber of Commerce, while the big banks try to preserve deniabilty. Because of the lengths they'll have to go to to accomplish that, I suspect the campaign will be much weaker than it otherwise would be. (In fact, given the potential headaches and the likelihood the effort will fail, many big banks may opt to steer clear of it altogether, even behind the scenes.)