For weeks, the White House has been fending off attacks from Massachusetts Sen. Elizabeth Warren on trade negotiations, and now the president seems to be growing more impatient, dismissing one of her objections as "pure speculation."
Warren argued this week that giving the president trade promotion authority could "dismantle" the Wall Street overhaul law known as Dodd-Frank, which was proposed by the president and then passed by Congress in 2010 as a response to the 2008 financial crisis. The authority would give the president the ability to negotiate trade deals and then send them to Congress for an up-or-down vote that would not be subject to amendments or filibusters.
In a speech Tuesday at the Institute for New Economic Thinking, Warren said, "After fighting hard to protect Dodd-Frank for years, Democrats in the next few weeks could give Republicans the very tool they need to dismantle Dodd-Frank."
Asked about this in an interview with Yahoo's Matt Bai Friday, President Obama retorted, "She's absolutely wrong. And think about the logic of that, right? The notion that I had this massive fight with Wall Street to make sure that we don't repeat what happened in 2007, 2008. And then I sign a provision that would unravel it? I'd have to be pretty stupid."
Warren's logic here seems to be that if a Republican won the White House, he or she would be able to use trade promotion authority to push deals through Congress that would contain weakened financial regulations. But as the Wall Street Journal notes, the administration has set financial regulations outside the trade negotiations, at least in relation to one of the deals, the Transatlantic Trade and Investment Partnership (TTIP). The Journal concedes her scenario is theoretically possible but very unlikely, since a GOP president could probably just directly weaken or even repeal Dodd-Frank with what would likely still be a Republican Congress.
Mr. Obama said that there was no evidence trade promotion authority could be used in this way and dismissed her comments, telling Bai, "This is pure speculation. She and I both taught law school and, you know, one of the things you do as a law professor is you spin out hypotheticals. And this-- this is all hypothetical, speculative."
Warren on Tuesday insisted that the scenario she has painted is very real. "This is hardly a hypothetical possibility: We are already deep into negotiations with the European Union on a trade agreement and big banks on both sides of the Atlantic are gearing up to use that agreement to water down financial regulations," she said.
Mr. Obama, for his part, told Bai, "Elizabeth is - you know - a politician like everybody else."
The president reiterated - as he has many times - that the two agree on most issues. But, "On this one though, her arguments don't stand the test of fact and scrutiny."