Massachusetts Bankruptcy and Elizabeth Warren

Advocates for Massachusetts consumers are looking seriously at Elizabeth Warren’s record of pro-consumerism as the election nears. Warren, running for United States Senator from Massachusetts, aims to be the first woman senator from our generally progressive state. From the perspective of a Boston bankruptcy attorney, we could not have a better advocate for Massachusetts consumers who are at financial risk.

Elizabeth Warren, who got her start in community college in Oklahoma where she grew up, ended up as a full professor at Harvard Law School with a specialty in bankruptcy law. She earned her law degree at Rutgers School of Law in New Jersey. She was elected to the National Bankruptcy Review Commission in 1995 because of her academic studies on bankruptcy and how it applied to low and moderate income folks, and women. She was instrumental in drafting the NBRC report. Her work there was, essentially, to fight the banks and big lenders who wanted to pass legislation which would make it harder for moderate income people to file for personal bankruptcy.

From 2005 to 2010, Professor Warren was on the FDIC Committee on Economic Inclusion, using her academic research to foster federal rule making. With her daughter, she wrote the book “The Two-Income Trap: Why Middle-Class Mothers and Fathers Are Going Broke.” The book highlights the current economic situation with households now requiring two incomes and having greater economic pressure. The book, and much of her recent political discourse, discusses the fact that education, including student loans, has become too expensive for much of America.

Professor Warren’s legal scholarship is regularly cited in other law journals. For example, in a distinguished study “Bankruptcy, Women’s Financial Well-Being” published by Brooklyn Law Review, by Kristin Brandser Kalsem, Kalsem noted that Warren’s Harvard Women’s Law Journal article of 2002, entitled “What is a Women’s Issue: Bankruptcy, Commercial Law and Other Gender-Neutral Topics” was the seminal academic research on women and bankruptcy. It focused on financial issues for women, including the fact that there was a sharp rise in women filing personal bankruptcies and that bankruptcy law is a part of the women’s safety net we now have in this country. Professor Warren noted that there was an 800% increase in women filing for bankruptcy over the past two decades.

In 2005, Congress passed, and President Bush signed into law, the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005. This law makes it considerably harder for folks to file for personal bankruptcy. It also makes it more expensive. We have written extensively about this in our blogs.

More recently, Professor Warren’s work with Congress resulted in portions the Dodd Frank legislation establishing the United States Financial Protection Bureau. Ms. Warren was on the Congressional Oversight Panel, where her responsibility was to oversee the federal Troubled Asset Relief Program (TARP). Her Congressional Oversight Panel, issued regular reports regarding the federal response to the housing fiasco, as well as other government lending programs.

Next, she was appointed by President Obama to be his Assistant Advisor to the Secretary to the Treasury, to start the Consumer Financial Protection Bureau (CFPB) that she had worked so hard to have passed by Congress.