Her conversion was ideological before it turned partisan. The first shift came in the mid-’80s, as she traveled to bankruptcy courts across the country to review thousands of individual cases—a departure from the more theoretical academic approach—and saw that Americans filing for bankruptcy more closely resembled her own family, who struggled financially, rather than the irresponsible deadbeats she had expected.
,,,In her paper, however, Warren argued that utility companies were over-regulated and that automatic utility rate increases should be institutionalized to avoid “regulatory lag,” in spite of consumer advocate concerns. “Eliminating regulatory lag will end the need for frequent rate hearings, and will, thus, reduce the administrative costs of regulation,” she wrote. On the other side of the debate were consumer advocates, whose arguments she described then as “fallacious” and based on “unscrutinized, long-accepted conventional wisdom.”
,,,What struck me was her lack of presentation of the consumer viewpoint and the underlying policies governing rate-making. She simplistically makes conclusions without any analysis of actual facts, just economic theory.”
…In our interview, Warren dismissed the idea that the paper suggested she was a conservative. “I followed theory and tried my hand at what all academics did then in our field, and that was theory,” she said. “I pretty quickly discovered not only that the theory was wrong, but it was deeply misleading.”
…According to people on the commission, Warren—who was still a registered Republican when she started in the role and told other staffers so—came across as a policy-minded academic who worked hard at incorporating different viewpoints, even if she disagreed.
…On the presidential campaign trail, she still pitches her reforms and proposals, even those with dramatic government intervention, as means of correcting the market, not replacing it. Warren named her signature campaign proposal—sweeping reforms aimed at corruption—the Accountable Capitalism Act. Her call to break up large technology companies, she says, is about how their size has created an unfair playing field, a failing market. Her proposal to create a government manufacturer of generic drugs comes from her belief that the market has broken down, with generic drugs either not being produced or rising in price; a public option for generic drugs could jump-start the marketplace, she hopes.
“That’s her fundamental framework—she’s a believer in economics,” says Johnson, her UT-Austin colleague. “It’s just that she now shifts to protect consumers.”