Elizabeth Warren warns another financial crisis is coming — but she has a plan

Posted at 6:11 AM, Jul 22, 2019
and last updated 2019-07-22 11:42:12-04

Massachusetts Sen. Elizabeth Warren said there are warning signs for another financial crisis that would devastate the United States — “a single shock could bring it all down” — and the 2020 presidential candidate proposed a plan she said could help prevent it.

“I warned about an economic crash years before the 2008 crisis, but the people in power wouldn’t listen,” Warren wrote in a Medium post. “Now I’m seeing serious warning signs in the economy again — and I’m calling on regulators and Congress to act before another crisis costs America’s families their homes, jobs, and savings.”

The post came after Warren put out an extensive plan last week to rein in Wall Street. The senator, who has pressed heavily upon fixing the economy ahead of the second round of Democratic presidential debates hosted by CNN, proposed the reinstatement of a modern Glass-Steagall Act in the plan.

Most of the solutions she offered in the Medium post are part of plans she’s already proposed but in this case is grouping them together to offer it as a way to combat an economic crisis.

The senator wrote that she’s worried about several factors she says are contributing to the beginning of a financial crisis — including growing household debt, growing corporate debt and a manufacturing recession.

“The country’s economic foundation is fragile,” Warren wrote. “A single shock could bring it all down. And the Trump administration’s reckless behavior is increasing the odds of just such a shock.”

Her solution? She said she has a plan to decrease household debt by increasing the minimum wage, canceling student loan debt, bringing down the cost of childcare and making tuition free at every public technical school, two-year college, and four-year college.

She proposed monitoring and reducing leveraged corporate lending and limiting potential shocks to the economy. As an example, Warren faulted the Trump administration for creating economic chaos, including President Donald Trump’s trade war with China and through Trump “goading the U.K. toward a no-deal Brexit.”

“Warning lights are flashing,” she wrote. “Whether it’s this year or next year, the odds of another economic downturn are high — and growing. Congress and regulators should act immediately to tamp down these threats before it’s too late.”