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No One Wants to Serve on House Financial Services?

posted by Adam Levitin

The Washington Post reports today that many of the incoming Democratic freshman representatives do not want to serve on the House Financial Services Committee, traditionally a plum assignment because it facilitates representatives' ability to fund-raise for their reelection.  I'm proud to say that the member-elect who is proudly bucking the trend is our former co-blogger, Katherine Porter, and I can confidently say that her interest in the committee has nothing to do with fund-raising and everything to do with its jurisdiction.  

There are a lot of good reasons an incoming member might not want to serve on HFS--the member might have expertise or interest that more closely tracks the jurisdiction of another committee.  But I worry that the lack of interest also reflects a really problematic trend on the left. While many progressive politicians like to decry abuses in the financial services industry, they often have little to no understanding of the industry and aren't interested in gaining one.  The industry and its regulation are complex.  Its often not as intuitively understandable as, say, issues of criminal justice reform.  But its consequences are at least as far-reaching, both because all Americans depend on financial services and because of the influence of financial services on the whole political process.  Any politician who is concerned about social inequality ought to be deeply engaged with financial regulation.  It's not the low-hanging fruit, perhaps, but it's where the future of the middle class will be decided.  

Sadly, this phenomenon isn't limited to progressive politicians.  It's endemic on law school faculties.  I recall several years ago hearing colleagues bemoaning the financial crisis foreclosure crisis, but having absolutely no clue about what led up to it and what was contributing to it.  They did, however, have lots of strong normative views on methods of Constitutional interpretation.  The irony here is that my colleagues very much understand that dry, technical legal rules can have enormous social consequences.  But they prefer to engage primarily with social justice, rather than economic justice issues, even though the two are intimately linked.  I suspect this is part of the general phenomenon of the legal academy having disengaged with its traditional bread-and-butter---commercial law.  But it meant that much of the progressive establishment was asleep at the wheel (if not financially co-opted) when financial deregulation occurred in the 1990s and 2000s. 

To be sure, there's a small cadre of progressive thought-leaders and politicians (most notably some of our former co-bloggers) who have taken the time to understand the financial system in depth, and they've contributed in an out-sized manner to financial regulatory debates.  But the fact remains that most progressives don't want to touch financial and commercial regulation.  And we're all the worse off for it.  

Comments

You sound like kindred spirits. I have a series of 3 articles discussing how finance is ripping apart the industrial base. http://www.dollarsandsense.org/archives/2018/1118duggan.html I'd appreciate it if you could read and help me get this around. You are so right that the fate of the middle class rests on our ability to regulate financial services.

I'll rephrase Adam's complaint more brutally. Modern legal academics are repelled by nerdly technique, even though their skill sets are in the nerdly direction. Like a bunch of adolescents playing Risk, they want to exercise power, or at least kibitz the exercise of power. Hence, the obsession with the federal judiciary and Con Law, or the secondary obsession with Biglaw.

It's not that legal scholars don't care about economic justice, although there is some of that. It's that they act like teenagers, too easily bored to acquire nerdly craft. They would rather be "relevant." Sidewalk sociology is so easy and fun, especially if you're smart-but-ignorant!

The UCC is quintessential nerdliness. It contains some room for debate (even on fundamentals!), but nobody wants to listen to you until you have learned an enormous amount of really dull and apolitical technique. Two UCC-heads can talk shop for hours without having any idea of the other nerd's politics. This is not attractive to the adolescent mind, except for the obsessives. The adolescent obsessives usually end up in tech anyway. (A lot of UCC scholars have STEM backgrounds, fwiw.)

As a 2016 law graduate who worked as a legal services consumer attorney on a one-year fellowship directly after law school, I completely agree with this assessment. I go back to a comment I read on this site a few months ago: “[H]ousing is of macroeconomic importance in a way that corporate debt is not. Part of it is the size of the market--the $12.0 trillion residential mortgage market is much bigger than the corporate debt market ($8.6 trillion total). [As an aside, this raises the question of why corporate finance is a standard law school offering, but not housing finance...]”

At the risk of giving away too much personal information here, the only course that really prepared me for my day-to-day as a consumer attorney was ... no surprise ... Bankruptcy, with Katie Porter.

How do we each advocate for additional course offerings, and also a more pragmatic and experience-based approach to doctrinal courses, in our home law school institutions?

Why don't you guys try taking on some of these cases - that's where the works at - we'll never have reform and the working-middle class will not be championed until you guys who haunt this blog including Katie - start representing these cases . . . I/we have done all this work but no attorney worth their salt will take on these cases. This one in particular is an excellent hybrid: BK, TILA, forged/counterfeit assignments, some of the biggest private hedge fund gurus in the business (Ranieri, Leon Black, Josh Harris, Marc Rowan, Realogy, Apollo, etc.) and you guys just continue to brush off handling these cases - letting them be defended by pro se litigants who are fighting alone with no money and no 'consumer protections' those actions you guys should be handling; shame on you - now's the time if Katie is taking the helm to bring cases like this one (not mentioned)to the forefront in the house ... Congrats Katie, but disappointed in no one still doing what matters - getting in the ring with these cases . . . geesh

Respectfully, Deby, you are wrong and writing without knowledge of the extensive work that I and other co-bloggers do. We don't advertise most of it on the blog, but we write amicus curiae briefs, serve as expert witnesses, and serve as consultants in various mortgage-defense or mortgage-fraud related litigations, often on a pro bono basis for legal aid societies. We are generally not practicing attorneys (I don't think any of us carries malpractice insurance, for example), so we're not in the business of representing consumer litigants.

In any case, the sad truth is that the courts are not very receptive to mortgage chain-of-title cases. Some of this is because there have been a lot of really poorly lawyered cases (including by pro ses) that have fouled the well for well-litigated cases, but it's also because at the end of the day many courts are going to ask if the borrower took money and failed to pay it back. If so, the court isn't going to get exercised over more "technical" problems.

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