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CBS Brings on Elizabeth Warren to Back More Bank Regulation; Spikes Ancestry Controversy

On Monday's CBS This Morning, Charlie Rose and Erica Hill touted Massachusetts Democrat Elizabeth Warren's past time as "the government's chief watchdog during the 2008 bank bailout" as she was brought on to discuss JP Morgan Chase's $2 billion loss. Rose and Hill asked all of their questions from the left, and completely ommited any mention of the recent controversy over Warren's claim of Native American ancestry.

The anchor set up the Senate candidate to push for more regulations on banks without rebuttal: "It's appropriate to have some government oversight, and notwithstanding the fact that we're just coming out of this huge crisis." Hill even wondered if the banks themselves "should be broken up into smaller entities."

Rose began by mentioning only in passing that his guest was "the Democratic Senate candidate in that state [Massachusetts]." The liberal premise behind his first question was apparent: "What do you hope is the fallout from this, in terms of regulatory action?"

After Warren called for the resignation of JP Morgan CEO Jamie Dimon from the New York Federal Reserve board of directors, the anchor followed up by noting that Dimon "said that he supported 75 percent [sic] of Dodd/Frank, which was a principal regulation to come out." The senate candidate laughed this off, and replied that "what we have to remember is Dodd/Frank itself was a compromise, and now, what's happened is that the large financial institutions, led by Jamie Dimon, have gone after the regulators....They've done everything they can to stick with the idea that...there's no need for anyone from the outside looking at them. And I think that's just fundamentally wrong. It's wrong and it's dangerous."

Later in the segment, Hill asked her question about whether the banks should be broken up. As you might expect, Warren all but endorsed this idea: "The irony is that I was here talking about the risks posed by the largest financial institutions in 2008 and 2009, we talked about too much concentration in the banking industry; and now, here we are in 2012 with more concentration in the banking industry. The big have gotten bigger, and that's a danger."

Besides omitting the ancestry issue, the morning newscast didn't mention that Dimon was among the most frequent visitors to Treasury Secretary Tim Geithner during the months after his confirmation in 2009. The CEO was also complimented by President Obama in early 2009: "[T]here are a lot of banks that are actually pretty well managed; JP Morgan being a good example. Jamie Dimon, the CEO there; I don't think he should be punished for doing a pretty good job managing an enormous portfolio."

Exactly two weeks earlier, on April 30, CBS This Morning gave leftist New York Times columnist Paul Krugman a platform to call for massive government spending: "Now is not the time to be slashing....Now is the time to be doing public works, to be rehiring those school teachers, to get this economy moving again."

The full transcript of the interview of Elizabeth Warren, which began five minutes into the 7 am Eastern hour of Monday's CBS This Morning:

CHARLIE ROSE: With us now from Newton, Massachusetts is Elizabeth Warren, the Democratic Senate candidate in that state. She chaired the congressional oversight panel for the bank bailout. Good morning.

ELIZABETH WARREN, FORMER CHAIR, CONGRESSIONAL OVERSIGHT PANEL: Good morning.

ROSE: Good to see you.

WARREN: It's good to see you.

[CBS News Graphic: "Two Billion Dollar Blunder: Fmr. 'TARP' Chair On JPMorgan Chase Loss"]

ROSE: What do you hope is the fallout from this, in terms of regulatory action?

WARREN: Well, I'd like to see some real accountability here. I'd like to see Jamie Dimon, for example, resign from his position as a class A director of the New York Federal Reserve bank. You know, what's happened here is not just about JPMorgan Chase; it's about the kind of attitude, that the banks should be regulating themselves, rather than have real oversight. And so, the way I see this is that we have to say as a country, no; the banks cannot regulate themselves. They are financial institutions that run the risk of taking down everyone's job; run the risk of taking down everyone's pension; run the risk of taking down the entire economy. And that means it's appropriate to have some government oversight, and notwithstanding the fact that we're just coming out of this huge crisis.

Jamie Dimon has been the one who has led the charge in order to say, nope, no more regulation; fight back against regulation; call the regulation un-American; and resist, try to put loopholes into regulation, hire an army of lobbyists. This has really got to stop.

ROSE: Jamie Dimon yesterday, on 'Meet The Press', said that he supported 75 percent [sic] of Dodd/Frank, which was a principal regulation to come out.

[CBS News Graphic: "Jamie Dimon Statement: 'We have supported 70% or so of Dodd/Frank. We supported resolution authority, we support higher capital and liquidity.'"]
       
WARREN: (laughs) Yeah, you know, what we have to remember is Dodd/Frank itself was a compromise, and now, what's happened is that the large financial institutions, led by Jamie Dimon, have gone after the regulators. They kind of moved it from open warfare to guerrilla warfare. They've gone after the regulations; they've tried to delay them; they've tried to put loopholes in them; they've tried to tangle them up. They've done everything they can to stick with the idea that it should be the banks that manage their risk; that the banks are the ones who can regulate themselves; and there's no need for anyone from the outside looking at them. And I think that's just fundamentally wrong. It's wrong and it's dangerous.

ROSE: What regulation would have prevented JPMorgan from making this kind of trade?

WARREN: Well, you know, we have to start, Charlie, by saying, partly, we don't know all the details about this trade. But I'm going to start with the basic proposition- banking should be boring. Banking should not be this kind of high-risk activity. And, you know, that's what Glass-Steagall was all about. It said commercial banking- you know, the kind of stuff you and I understand about checking accounts and savings accounts and so on- should be one kind of activity and it should be boring. It should not be taking on risks. If you want to take on those risks, you need to be somewhere else. You need to be a Wall Street hedge fund- go do that- but keep a separation between those two.

ERICA HILL: You'd like to see those-

WARREN: Those laws-

HILL: You would like to see those two separated. Would you also like to see the banks themselves broken up into smaller entities?

WARREN: You know, it's a real question about how we're going to deal with the risks that the banks put forward right now- the larger the financial institution, the more risk it carries for the entire country- and the irony is that I was here talking about the risks posed by the largest financial institutions in 2008 and 2009, we talked about too much concentration in the banking industry; and now, here we are in 2012 with more concentration in the banking industry. The big have gotten bigger, and that's a danger.

[CBS News Graphic: "Too Big To Fail... Again? Fmr. 'TARP' Chair on JPMorgan Chase Blunder"]
                           
ROSE: Should Jamie Dimon have- witnessed resignations on the part of the people responsible, according to what is in the papers this morning. Is that enough for you, or you still insist that he leave the New York Fed as a director?

WARREN: Well, I think the importance of Jamie Dimon leaving the New York Fed is that it's a public acknowledgment that he is in a position of trust. Right now, he holds a position- think about this- with the New York Fed, in which he is advising the New York Fed about the appropriate oversight of banks like his bank. And I think one way he takes responsibility for what's gone wrong is to resign from that position and say, someone else should be in that public position, but that he should not be in it. And I just think that's one way to try to get a little more accountability into the system. When something happens, like what's happened at JPMorgan Chase, someone needs to be accountable, and part of that is, Jamie Dimon should withdraw from- should resign from this position of public trust.

ROSE Elizabeth Warren, thank you for joining us this morning.

WARREN: Thank you. It's good to see you. 

— Matthew Balan is a news analyst at the Media Research Center. You can follow him on Twitter here.