Personal Finance

Want To Know Where Candidate Elizabeth Warren Stands? Read Her Books

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Elizabeth Warren announced her candidacy with a video message last week. In her frank and what some call “folksy” way, she reiterated her concern for the middle class and her desire to help them as a Senator. Anyone who hasn’t followed her fight for the Consumer Financial Protection Bureau, and formed an opinion about her as result, need only read her books to find out what kind of candidate—and person—she is.

Before the housing boom and bust, and before the Great Recession, she shared her concern for the middle class in her groundbreaking book, The Two Income Trap. It’s had more of an impact on me as a financial writer than any other book I’ve read.

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Though well-written, it’s not an easy read. It starts with a gut-wrenching story of a typical couple who filed for bankruptcy after the husband/father lost his job. And it is filled with facts that spell out in raw detail how close so many American families are to the edge. Take these passages:

  • This year (2004), more women will file for bankruptcy than will graduate from college.
  • This year, more children will live through their parents’ bankruptcy than their parents’ divorce.

Or this one:

  • Having a child is the single greatest predictor that a woman will end up in financial collapse.

Again, this book was written before the financial meltdown, and if she and her co-author and daughter, Amelia Warren Tyagi, were to write this same book today, the outlook may be even more bleak.

What makes Elizabeth Warren’s concern for the American family so real and believable is that it’s backed up by solid research from an extensive study of consumer bankruptcies. She tells the story of having seen the first set of data and dumping it in the trash because she thought it couldn’t possibly be accurate.

But it was, and she’s been standing up for the individuals and families represented in that study ever since, both in her writing and in her work as a tireless advocate for stronger consumer protections.

In chapters like “Mom: The All-Purpose Safety Net,” and “The Myth of the Immoral Debtor,” she exposes tired clichés that portray Americans as nothing but reckless overspenders who deserve whatever financial hardships they may encounter as the price of their profligate ways. (Her book came out the year before Congress tightened the bankruptcy laws in an effort to keep more people out of bankruptcy—and as some say—in debt longer.)

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In the second personal finance book she wrote with her daughter, All Your Worth: The Ultimate Lifetime Money Plan, Warren and Tyagi start with a virtually heretical view of what it takes to be financially stable now:

You can’t count on good old-fashioned hard work the way your parents did. Go to school, get a good job, do your work, don’t go crazy with your spending and everything with work out, right? Not anymore.

There are those who will take issue with this view of the American dream, but Warren has the professional chops (and data) to back up her claims, and she pulls no punches.

Warren also briefly recounts early years with a family that just got by in Oklahoma; she got her first job at age 9, married at 19 and had her daughter three years later. She shares:

We lived on a budget so tight that I remember crying in relief when my mother-in-law offered me one of her dresses to wear to a job interview. (She was seven inches shorter than I am so you can imagine how ungainly I looked!)

Despite the fact that she became a tenured law professor at Harvard, and has had the ear of members of Congress and even Presidents, she remains true to her commitment to preserve the struggling middle class and it shows in her compassionate but realistic advice. How many other personal finance writers recommend a “Financial Firedrill?”

Warren has also authored/coauthored two more academic books for law students and attorneys: The Law of Debtors and Creditors: Text, Cases, and Problems and Chapter 11: Reorganizing American Businesses (Essentials). I have not read those.

It’s not unusual for political candidates to write vanity books to promote their cause. But here, Elizabeth Warren, the candidate, candidly shared her views on the challenges facing her future constituents long before she decided to run for office. If you want to know where she’s coming from, she’s an open book.

[Related article: Warren Announces Run for Senate]

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